Related to the Economics in Practice on Page 198: If

question 56

Multiple Choice

Related to the Economics in Practice on page 198: If firms have long-run average cost curves with a long, flat section

• A) their long run supply curves are downward sloping.
• B) the optimal number of firms in the industry is one.
• C) larger firms have a cost advantage over smaller firms.
• D) it is impossible to predict the size of the firm.

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Definitions:

Business Unit Reporting

The process of preparing and presenting financial and operational reports specific to distinct divisions or segments of a company.

Absorption-Costing Format

An accounting method that includes all manufacturing costs (direct materials, direct labor, and both variable and fixed overhead) in the cost of a product.

Controllable Costs

Expenses that can be directly controlled or influenced by a manager or decision-maker within a short term.

Cost Centre

A division or department within an organization that does not directly generate revenue but incurs costs, used to monitor and control expenses.