On a Graph of the Long-Run Average Total Cost Curve

question 254

Multiple Choice

On a graph of the long-run average total cost curve, constant returns to scale are shown as

• A) decreasing average costs as production capacity expands.
• B) increasing average costs as production capacity expands.
• C) constant average costs as production capacity expands.
• D) constant production capacity as costs expand.

---

Definitions:

Demand

In economics, the desire and ability of consumers to purchase goods and services at given prices.

Revenue Maximizing Price

The price at which a company can sell its product or service to generate the maximum total revenue, considering factors like demand and price elasticity.

Football Tickets

Passes that allow entry to football (soccer or American football) games, often purchased by fans to watch their favorite teams play.

Demand

Refers to the quantity of a particular good or service that consumers are willing and able to purchase at various prices during a given period of time.