If Output Is Increased in the Long Run,average Production Costs

question 5

Multiple Choice

If output is increased in the long run,average production costs in the presence of internal diseconomies of scale will ,and in the presence of external diseconomies of scale,will .

• A)decrease; remain constant
• B)increase; decrease
• C)remain constant; increase
• D)increase; remain constant
• E)decrease; decrease

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Definitions:

Easy Entry

A market condition where new competitors can join the market with minimal barriers or obstacles.

Industry

A classification that refers to a group of companies that are related based on their primary business activities.

Market

A market is a physical or virtual space where buyers and sellers come together to exchange goods, services, or resources, often determined by supply and demand dynamics.

Short-run Supply Curve

A graphical representation showing the quantity of a good a firm is willing to supply at different prices in a short time frame, typically with some fixed inputs.