Constant Returns to Scale Exist Over the Range of Output

question 152

Multiple Choice

Constant returns to scale exist over the range of output for which the long-run average cost is:

• A) neither rising or falling.
• B) falling.
• C) rising.
• D) none of the above.

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Definitions:

Contract Rate

A pre-agreed interest rate applied in the calculation of payments for a specific financial contract.

Market Rate

The prevailing interest rate available in the marketplace for instruments of comparable risk and maturity.

Bond Certificates

Documents that serve as legal proof of ownership of bonds, detailing the terms of the bond issue such as its maturity date, coupon rate, and issuer.

Market Value

The price that a buyer pays to purchase shares of capital stock in the open market. Of course, for every buyer there is a seller.