Long-Run Economies of Scale Exist When the Long-Run Average Cost

question 102

Multiple Choice

Long-run economies of scale exist when the long-run average cost curve

• A) rises.
• B) remains constant.
• C) falls.
• D) does not exist.

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Definitions:

Relevant Market

Represents the market segment or area where the competition and customer demand for a company's products or services are analyzed.

Consumer Product Safety Commission

A U.S. government agency responsible for the regulation of the sale and manufacture of consumer products to ensure their safety.

Social Regulation

Rules imposed by government to correct market failures and protect individuals and the environment from negative externalities, focusing on areas such as workplace safety, environmental protection, and public health.

Natural Monopolies

Natural monopolies occur in industries where the costs of production are lowest when only one firm provides the product or service, often due to high infrastructure costs making competition impractical.