External Economies of Scale Will ________ Average Cost When Output

question 7

Multiple Choice

External economies of scale will ________ average cost when output is ________ by ________.

• A) reduce; increased; the industry
• B) reduce; increased; a firm
• C) increase; increased; a firm
• D) increase; increased; the industry
• E) reduce; reduce; the industry

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Definitions:

Inflation

The pace at which prices for general goods and services ascend, diminishing the capacity to purchase.

Price Appreciation

refers to an increase in the value of an asset over time, typically evidenced by a higher market price.

Securities

Financial instruments that represent ownership positions in publicly traded corporations (stock), creditor relationships with governmental bodies or corporations (bonds), or rights to ownership as represented by an option.

Dividends

Payments made by a corporation to its shareholder members, distributing a portion of the company’s earnings.