If the Firm Can Vary All Factors of Production, It

question 50

Multiple Choice

If the firm can vary all factors of production, it is operating

• A) at a profit.
• B) at a zero economic profit.
• C) in the short run.
• D) in the long run.

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Definitions:

Average Costs

Calculated by dividing the total cost of production by the quantity of output produced, indicating the cost per unit of output.

Output Increases

A rise in the quantity of goods or services produced by a firm or economy.

Scale of Operations

The size or level at which a company or plant is operating, indicating its capacity to produce goods or services.

Average Cost Curve

A graphical depiction showing the cost per unit of output at different levels of production, reflecting the variability in total cost over volume.