The Experience-Curve Concept

question 42

Multiple Choice

The experience-curve concept:

• A) helps a company realize both learning effects and diseconomies of scale.
• B) suggests that unit manufacturing costs increase by a certain amount each time output is increased.
• C) is very important in industries that mass-produce a standardized output.
• D) suggests that achieving low costs allows a firm to charge a premium price.
• E) is least likely to bottom out as long as the company does not stop production.

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Definitions:

Prohibited

Forbidden by law, regulation, or other forms of official authority.

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The belief that one's actions can influence political processes and that participation in politics can bring about change.

American Democracy

A form of government in the United States characterized by a system of representation, rights, and freedoms for its citizens.