Minimum Efficient Scale Is the Output at Which

question 14

Multiple Choice

Minimum efficient scale is the output at which:

• A) long-run average cost is first minimized.
• B) long-run average cost first equals long-run marginal cost.
• C) short-run average cost equals long-run average cost for the first time.
• D) short-run marginal cost equals long-run marginal cost for the first time.
• E) diseconomies are first overcome and then economies of scale set in.

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Definitions:

Ledger

The principal book or computer file for recording and totaling economic transactions measured in terms of a monetary unit of account by account type.

Accounting Equation

A fundamental principle of accounting representing the relationship between a company's assets, liabilities, and equity (Assets = Liabilities + Equity).

Cash Refund

An amount paid by the seller to the buyer for merchandise that is defective, is damaged during shipment, or does not meet the buyer’s expectations.

Selling Price

The amount of money for which a product or service is offered for sale to customers.