Decreasing and Increasing Returns to Scale Account for the Shape

question 243

Multiple Choice

Decreasing and increasing returns to scale account for the shape of the:

• A)short-run average total cost curve.
• B)short-run average variable cost curve.
• C)long-run average total cost curve.
• D)marginal cost curve in both the short run and the long run.

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Definitions:

Discontinued Operation Loss

A loss recognized when a segment of a business is closed or disposed of, and its operations will not continue.

Operating Expenses

These are the expenses related to the day-to-day functioning of a business, including costs such as rent, utilities, wages, and maintenance.

Comparative Balance Sheet

Financial statements that provide a snapshot of a company's financial condition at different time points, allowing for comparison over time.

Total Assets

The complete sum of everything a company owns, both current and long-term, that can be used to produce value.