Figure 11-8 Consider the Average Cost Curve Shown in Figure 11-8, for Figure

question 22

Multiple Choice

Figure 11-8

Consider the average cost curve shown in Figure 11-8, for the production of cleaning. If the firm serves the entire market and sells Q₁ units. Based upon this information, the firm is experiencing

• A)constant returns to scale .
• B)increasing returns to scale.
• C)decreasing returns to scale.
• D)externalities.

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Definitions:

Subchapter S Corporation

A type of corporation designed for small businesses that allows income to be passed through to shareholders and taxed at individual rates, avoiding double taxation.

Net Income

The amount of revenue that remains after deducting all expenses, taxes, and costs from the total revenue of a business or individual.

Capital Gains

refer to the profit made from selling an asset for more than its purchase price.

Quarterly Estimated Payments

Payments made to the IRS by self-employed individuals or entities that anticipate owing tax of $1,000 or more, paid in four equal installments throughout the year.