Economies of Scale Refer to the Range of Output Over

question 52

Multiple Choice

Economies of scale refer to the range of output over which

• A) marginal cost exceeds average cost.
• B) the long-run average cost falls as output increases.
• C) the marginal product of labor diminishes.
• D) the long-run average cost is less than the short-run average total cost.

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Definitions:

Batch-level Activities

Operations and tasks performed for a group of units produced as a single batch, costing is aggregated at the batch level.

ABC

Activity-Based Costing, a method of allocating costs to products or services based on the resources they consume.

Unused Capacity

Refers to the resources or capabilities within a business that are not currently being used to their full potential, which can lead to inefficiencies or lost income.

Activity-based System

An activity-based system is a method of assigning costs to products or services based on the activities that go into producing them, aiming to provide more accurate cost information.