When a Firm's Long-Run Average Total Cost Falls as Its

question 117

Multiple Choice

When a firm's long-run average total cost falls as its output increases,the firm is experiencing

• A) economies of scale.
• B) diseconomies of scale.
• C) constant returns to scale.
• D) decreasing marginal returns.
• E) decreasing cost of marginal returns.

---

Definitions:

Ectoderm

The outermost layer of cells or tissue of an embryo in early development, giving rise to the epidermis and nervous system.

Oral Cavity

The mouth; consists of the space surrounded by the lips, cheeks, teeth, and palate; limited posteriorly by the fauces.

Adrenal Glands

Endocrine glands that produce a variety of hormones including adrenaline and cortisol, located above the kidneys.

Posterior Pituitary

A part of the brain that releases hormones produced in the hypothalamus, like vasopressin and oxytocin.