If Long-Run Average Total Cost Decreases as the Quantity of Output

question 38

Multiple Choice

If long-run average total cost decreases as the quantity of output increases, the firm is experiencing

• A)economies of scale.
• B)diseconomies of scale.
• C)coordination problems arising from the large size of the firm.
• D)fixed costs greatly exceeding variable costs.

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Definitions:

Otic Ganglion

A small parasympathetic ganglion located just below the ear, associated with the glossopharyngeal nerve, involved in salivation and lacrimation.

Parasympathetic Cranial

Pertaining to the cranial part of the parasympathetic nervous system, which helps control bodily functions when at rest, like saliva production and slowing the heartbeat.

Glossopharyngeal

A cranial nerve (IX) that manages taste and other functions in the throat and tongue.

Abducens

Refers to the sixth cranial nerve, which controls the lateral rectus muscle of the eye, responsible for outward eye movement.