Constant Returns to Scale Are Associated with A

question 55

Multiple Choice

Constant returns to scale are associated with a:

• A) horizontal long-run average cost curve.
• B) horizontal short-run average cost curve.
• C) downward-sloping long-run average cost curve.
• D) downward-sloping short-run average cost curve.

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Definitions:

Maximize Profits

The process or strategy aimed at achieving the highest possible profit margins by managing costs and increasing revenue.

Bushels

A unit of volume that is used for measuring quantities of agricultural produce such as grains.

Production Possibilities

Different combinations of goods and services that a society can produce given its available resources and technology.

Average Product

The output per unit of input, calculated by dividing total production by the number of input units.