Which of the Following Is Not Held Constant When Constructing

question 85

Multiple Choice

Which of the following is not held constant when constructing a demand curve for good X?

• A) Consumer income
• B) Consumer tastes
• C) Price of good X
• D) Prices of other goods
• E) Consumer expectations

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Definitions:

Economies of Scale

The cost advantages that enterprises obtain due to their scale of operation, with cost per unit of output generally decreasing with increasing scale as fixed costs are spread out over more units of output.

Unit Costs of Production

The total expense incurred by a company to produce, store, and sell one unit of a particular product or service.

Diseconomies of Scale

The condition in which a firm’s costs per unit of output increase as the firm increases in size or scale of operation.