When There Is a Capacity Constraint

question 132

Multiple Choice

When there is a capacity constraint,

• A)firms face sunk costs when deciding whether or not to expand.
• B)consumers will avoid the producer and go with a firm that has extra capacity.
• C)firms are not maximizing their profits during high season.
• D)firms can use peak-load pricing to increase profits during periods of high demand.

---

Definitions:

Accounting Club

An organization or group often found in academic settings that focuses on the study and discussion of accounting practices, career development, and networking for accounting students and professionals.

Marginal Analysis

An examination of the benefits and costs of an additional unit of production or activity to make better decisions.

Tutoring

The act of providing individualized instruction or assistance to a student or learner in a specific subject area to improve their understanding or performance.

Economics Test

An examination or assessment aimed at evaluating understanding or knowledge in the subject of economics.