Constant Returns to Scale Cause the Long-Run Average Cost Curve

question 60

Multiple Choice

Constant returns to scale cause the long-run average cost curve to be:

• A) horizontal.
• B) vertical.
• C) upward-sloping.
• D) downward-sloping.

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Definitions:

Option Contract

An agreement that gives the holder the choice, but not the obligation, to buy or sell an underlying asset at a set price on or before a certain date.

Foreign Currency

Currency used in a country other than one’s own, reflecting the economic practices and transactions in foreign nations.

Zero Sum Game

A situation in game theory where one participant's gains or losses are exactly balanced by the losses or gains of the other participants.

Options Contracts

Options contracts are agreements between two parties to buy or sell an asset at a predetermined price on or before a specific date.