Decreasing Returns to Scale May Occur as Increasing the Amount

question 55

Multiple Choice

Decreasing returns to scale may occur as increasing the amount of inputs used

• A) increases specialization.
• B) always increases the amount of output produced.
• C) may cause coordination difficulties.
• D) increases efficiency.

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Definitions:

Cash Paid

The total amount of money disbursed by a company in transactions, such as paying bills, salaries, or purchasing goods.

Interest

The charge for borrowing money, typically expressed as a percentage of the amount borrowed, paid by the borrower to the lender.

Cash Flow Ratio

A financial metric that compares a company's operating cash flow to its current liabilities, indicating its ability to pay off its obligations with the cash it generates.

Operating Activities

Activities directly related to the business's primary operations, including cash flows from sales, expenses, and cost of goods sold.