Which of the Following Statements Is True

question 169

Multiple Choice

Which of the following statements is true?

• A) In the long run, the average cost curve is always downward sloping.
• B) In the long run, the quantities of all inputs are fixed.
• C) In the long run, the firm's fixed costs are greater than its variable costs.
• D) In the long run, all costs are variable costs.
• E) In the long run, the total variable cost equals the total fixed cost.

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Definitions:

Common Stock

A form of corporate equity ownership, a type of security that represents ownership in a corporation and a claim on part of the corporation's profits.

Dividends

Payments made by a corporation to its shareholders, usually as a distribution of profits.

Net Cash Flow

The amount of cash generated or lost over a specific period, considering cash inflows and outflows.

Depreciation Expense

The allocation of the cost of a tangible asset over its useful life, reflecting the decline in its value due to wear and tear.