If the Firm's Fixed Costs Double While Variable Costs Are

question 92

Multiple Choice

If the firm's fixed costs double while variable costs are unchanged, then

• A) marginal cost more than doubles.
• B) marginal cost doubles.
• C) marginal cost remains unchanged.
• D) average total cost remains unchanged.
• E) average variable cost doubles.

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Definitions:

Large-Scale Production

The manufacturing of large quantities of a product quickly and efficiently, benefiting from economies of scale.

Overallocate Resources

The situation in which too many resources are dedicated to a specific task or sector, potentially leading to inefficiency and waste.

Price Discrimination

The practice of charging different prices to different consumers for the same product or service, based on willingness to pay.

Antitrust Regulations

Laws designed to prevent anti-competitive practices and promote fair competition among businesses.