In Some Industries, Like Insurance, Both Small and Very Large

question 63

Multiple Choice

In some industries, like insurance, both small and very large firms coexist and compete quite effectively in the market. This indicates that the long-run average total cost curve in these industries

• A) is "U" shaped.
• B) is downward sloping over all levels of output.
• C) exhibits constant returns to scale over a wide range of output.
• D) exhibits diseconomies of scale beginning at a low rate of output.