A Firm Scaled Down Its Operation by Reducing All Inputs

question 113

Multiple Choice

A firm scaled down its operation by reducing all inputs by 50% and experienced a less-than-50% decrease in output. If all input prices remain unchanged, the firm's long-run average cost exhibits

• A) economies of scale at the current output level.
• B) diseconomies of scale at the current output level.
• C) a constant long-run average cost at the current output level.
• D) diminishing marginal returns at the current output level.

Understand the impact of communication styles and networks on team effectiveness.

Identify role-related challenges within teams (role conflict, ambiguity, overload, and underload).

Recognize the importance of meeting both task needs and social needs within teams.

Understand various team-building approaches and their applications.

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Definitions:

External Costs

External costs are expenses that are not borne by the individuals or organizations responsible but rather by society as a whole, often involving negative environmental impacts.

Efficient Level

The point at which a system operates at maximum capacity without waste, producing optimal output with the lowest input.

Profit-Maximizing

A strategy or process used by firms to determine the output level and pricing that yields the highest possible profit.

Negative Externality

An adverse effect on a third party not directly involved in an economic transaction, often leading to market failure if not properly addressed.