Under What Circumstances Does a Firm Operate with Excess Capacity

question 151

Multiple Choice

Under what circumstances does a firm operate with excess capacity

• A)when additional production would lower the average total cost
• B)when additional production would increase average total cost
• C)only if it is a perfectly competitive firm in the long run
• D)only if it is a monopolistically competitive firm in the short run

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Definitions:

UCC

A complete array of laws, known as the Uniform Commercial Code, regulates all commercial activities within the United States.

Software Engineer

A professional who applies engineering principles to the design, development, maintenance, testing, and evaluation of the software and systems that make computers or anything containing software, such as chips, operate.

Statutory Liens

Statutory liens are legal claims against property that are established by statute to secure the payment of a debt or obligation, such as tax liens.

Cosurety

One of two or more individuals or entities jointly responsible for fulfilling the obligation of a surety, sharing liability for ensuring the performance or payment of an obligation.