As Production Moves Up, the Average Cost Per Unit Decreases

question 127

Multiple Choice

As production moves up, the average cost per unit decreases because ________.

• A) variable costs decrease
• B) of increasing diseconomies of scale
• C) fixed costs are spread over more units
• D) overhead costs decrease
• E) revenue increases

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Definitions:

Ethylene

A hydrocarbon gas (C2H4) that acts as a plant hormone, regulating a wide range of processes including fruit ripening and leaf senescence.

Jasmonic Acid

A plant hormone that plays a key role in stress responses, growth, and developmental processes, as well as in defense mechanisms against pathogens.

Prostaglandins

A group of lipid compounds that have diverse hormone-like effects in animals, including involvement in inflammation and pain management.

Cryptochrome

A class of flavoproteins that are sensitive to blue light and found in plants and animals, playing a role in the regulation of circadian rhythms.