The Minimum Efficient Scale of a Firm Is the

question 146

Multiple Choice

The minimum efficient scale of a firm is the

• A)largest scale of production for which the marginal cost is at a minimum.
• B)largest scale of production for which the long-run average total cost is at a minimum.
• C)largest scale of production for which the long-run average variable cost is at a minimum.
• D)smallest scale of production for which the long-run average total cost is at a minimum.
• E)smallest scale of production for which the long-run average variable cost is at a minimum.

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Definitions:

Consumer's Risk

The probability of accepting a batch of products that fails to meet quality standards during the sampling or inspection process, typically associated with Type II statistical errors.

Process Central Line

A line on a control chart representing the average or expected value of the process being monitored.

X-bar Chart

A type of control chart used for monitoring the mean value of a process over time.

Natural Variation

Variability that affects every production process to some degree and is to be expected; also known as common cause.