A Firm with Decreasing Returns to Scale Would See

question 48

Multiple Choice

A firm with decreasing returns to scale would see:

• A) decreasing long-run marginal costs.
• B) increasing long-run marginal costs.
• C) constant long-run marginal costs.
• D) More information is necessary to determine the answer.

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Definitions:

FDIC

The Federal Deposit Insurance Corporation, a United States government agency that provides deposit insurance to depositors in US banks.

Speculative

Actions based on conjecture rather than knowledge, often in the context of investment, involving risks with the hope of substantial gains.

Interest Rate

The rate, represented as a fraction of the total loan, charged by a credit provider to a loan recipient for borrowing funds or assets.

Transactions

The action of conducting business, trade, or an exchange between two or more parties, often involving financial operations.