The Enron Scandal

question 73

Multiple Choice

The Enron scandal:

• A) led to the impeachment of Bill Clinton.
• B) resulted in the decline of organized labor.
• C) occurred because of lax enforcement of the Glass-Steagall Act.
• D) was one result of the repeal of the Glass-Steagall Act.
• E) restored American confidence in the stock market.

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Definitions:

LRAC Curve

the Long-Run Average Cost curve, showing the lowest average cost at which any output level can be produced when all inputs are variable.

Increasing-Cost Industry

An industry where the costs of production increase as the output expands, often due to factors like resource depletion and higher input prices.

LRAC Curve

Long-Run Average Cost Curve, showing the lowest cost at which a firm can produce any given level of output in the long run, where all inputs are variable.

Increasing-Cost Industry

An industry in which production costs increase as firms enter the market, often due to limited resources or factors of production.