If Output Is Increased in the Long Run, Average Production

question 25

Multiple Choice

If output is increased in the long run, average production costs in the presence of internal diseconomies of scale will ________, and in the presence of external diseconomies of scale, will ________.

• A) decrease; decrease
• B) increase; remain constant
• C) remain constant; increase
• D) decrease; remain constant
• E) increase; decrease

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Definitions:

Good Performance

A measure of how well a task is executed or the success level of an endeavor or employee.

Expectancy

The probability that the amount of work effort invested by an individual will result in a high level of performance.

Instrumentality

The probability that good performance will lead to various work outcomes.

Difficult Goals

Targets or objectives that are challenging to achieve due to their complexity, high standards, or the significant efforts required.