When a Firm Operates with Excess Capacity

question 51

Multiple Choice

When a firm operates with excess capacity,

• A)additional production would lower the average total cost.
• B)additional production would increase the average total cost.
• C)it must be a perfectly competitive firm.
• D)it must be a monopolistically competitive firm.

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Definitions:

Authoritarian Government

A form of government characterized by strong central power and limited political freedoms, essentially synonymous with authoritarian states.

Egalitarianism

A belief in human equality, especially with respect to social, political, and economic rights and privileges.

Collective Ownership

The holding of property or assets by all members of a group or community, sharing both rights and responsibilities.

Direct Voting

A voting system where citizens vote on laws, policies, or leaders directly, without intermediaries or representatives.