If the Cost of Producing Two or More Outputs Jointly

question 97

Multiple Choice

If the cost of producing two or more outputs jointly is less than the cost of producing the outputs separately, _____.

• A) economies of scope are said to exist
• B) the firm's managers would not want to allow portfolio diversification
• C) economies of scale are said to exist
• D) the firm's shareholders would not want to allow portfolio diversification

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Definitions:

Demand

The total amount of goods or services that consumers are willing and able to purchase at various prices during a specified period.

Demand Curve

A graphical representation showing the relationship between the price of a good and the quantity of that good that consumers are willing to buy.

Price Ceiling

A government-imposed limit on how high the price of a product or service can be charged in the market, aimed at protecting consumers from high prices.

Quantity Demanded

The amount of a product or service consumers are willing and able to purchase at a given price.