What Is Not True If a Firm Exhibits Decreasing Average

question 74

Multiple Choice

What is not true if a firm exhibits decreasing average cost as quantity increases?

• A)Marginal cost must be below average cost.
• B)Firms would go bankrupt if all prices were equal to marginal cost.
• C)More customers can be served at lower average costs per unit.
• D)This is called diseconomies of scale.

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Definitions:

Na+

Sodium ion, a vital electrolyte in the human body that helps regulate fluid balance and nerve function.

White Matter

A component of the central nervous system, primarily consisting of myelinated nerve fibers and responsible for communication between different brain regions.

Myelinated Axons

Axons that are encased in myelin, a fatty substance that speeds up the transmission of nerve impulses.

Ganglial Sheaths

Protective coverings around ganglia, which are clusters of nerve cell bodies in the peripheral nervous system.