A Firm Doubles the Quantity of All Resources It Employs

question 346

Multiple Choice

A firm doubles the quantity of all resources it employs and, as a result, output doubles. Which of the following is correct?

• A)There are increasing returns to scale.
• B)The long-run average total cost curve is flat.
• C)The law of diminishing returns is proven wrong.
• D)The example is for the short-run rather than the long-run.

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