The Graph Below Includes Two Plant Sizes as Illustrated by AC₁

question 3

Multiple Choice

The graph below includes two plant sizes as illustrated by AC₁ and AC₂.

-Refer to the graph above to answer this question.Which of the following statements is correct if a firm is operating at point a on AC₁?

• A)The firm has achieved capacity output.
• B)The firm is achieving MES.
• C)An increase in the output would not lower costs.
• D)Building a larger plant would result in lower long-run average cost.
• E)Building a larger plant would not result in lower long-run average cost.

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Definitions:

Notification of Breach

A formal notice that a party to a contract has failed to perform an obligation, violating the terms of the agreement.

Measure of Damages

A method used in legal contexts to calculate the amount of compensation owed to a party as a result of loss or injury.

United Nations Convention

An international treaty or agreement formulated under the auspices of the United Nations, pertaining to various global issues.

International Sales Contract

A legally binding agreement between parties from different countries for the sale and purchase of goods.