Long-Run Diseconomies of Scale Exist Over the Range of Output

question 172

Multiple Choice

Long-run diseconomies of scale exist over the range of output for which the long-run average cost curve is

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

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Definitions:

Labor Efficiency Variance

Labor Efficiency Variance measures the difference between the actual hours worked and the standard hours expected for the work performed.

Direct Labor Wage

The compensation workers receive for directly contributing to the manufacturing or production of goods, usually an hourly wage or per unit produced rate.

Variable Overhead Rate Variance

The difference between the actual variable overhead incurred and the standard cost allocated for the actual production level.

Variable Manufacturing Overhead

Costs that vary with production volume, such as utilities and materials used in the production process.