Assume a Firm Is Using 10 Units of Labour and 10

question 60

Multiple Choice

Assume a firm is using 10 units of labour and 10 units of capital and is producing 10 units of output per hour.Now both inputs are doubled,resulting in output rising to 18 units per hour.The firm is experiencing

• A)decreasing returns to scale.
• B)economies of scale.
• C)increasing returns to scale.
• D)constant returns to scale.
• E)decreasing costs.

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Definitions:

Unfriendly Takeover

An attempt by one company to acquire control of another company without the consent or cooperation of its management or board of directors.

Going-private Transaction

A process by which a publicly traded company is transformed into a privately-held entity, usually through a buyout or acquisition.

Tender Offer

A public, open offer or invitation (usually made by a company) to all shareholders to sell their shares at a particular price during a specified time.