Diseconomies of Scale Cause the Short-Run Marginal Cost Curve to Slope

question 15

True/False

Diseconomies of scale cause the short-run marginal cost curve to slope upwards.

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Definitions:

Payback Period

The time it takes for an investment to generate an amount of income or cash equivalent to the cost of the investment itself.

Straight-line Basis

Straight-line basis is a method of calculating depreciation and amortization, wherein an asset's cost is evenly spread over its useful life.

Cash Flow

A measurement of the net amount of cash and cash-equivalents being transferred into and out of a business.

Incremental Cost Approach

A decision-making process that focuses on the changes in total cost that would result from a decision to pursue one alternative over another.