All of the Following Statements Are True of the Minimum

question 162

Multiple Choice

All of the following statements are true of the minimum efficient scale except one.Which one?

• A)All possible economies of scale have been exhausted.
• B)The short-run average total cost curve's minimum point is equal to the long-run average cost curve's minimum point.
• C)Any increase in the scale of operation will encounter either constant returns to scale or diseconomies of scale.
• D)An increase in the output level will increase profit.

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Definitions:

Forming Department

A specific section within a manufacturing facility where raw materials are shaped or formed into parts for further assembly or production processes.

Assembly Department

A division within a manufacturing plant where components are assembled into final products, often involving various processes and equipment.

Predetermined Overhead Rate

A rate used to allocate overhead costs to products or services, calculated before the costs are incurred based on estimated costs and activity levels.

Direct Labor-Hours

The total hours worked by employees that are directly involved in the production of goods or the provision of services.