When an Increase in a Firm's Scale of Production Leads

question 122

Multiple Choice

When an increase in a firm's scale of production leads to higher average costs,the firm is experiencing

• A) economies of scale.
• B) constant returns to scale.
• C) decreasing returns to scale.
• D) diseconomies of scale.

---

Definitions:

Multiphase

Pertaining to a process or system that involves several distinct stages or phases.

Queuing Situation

A scenario where entities wait in line for a service or resource, leading to analysis for efficient management of waiting times and service processes.

Arrival Behavior

The pattern or characteristics of entities (such as people, vehicles, or data packets) arriving at a service system or facility, crucial for designing service processes and managing queues.

Renege

The act of withdrawing from an agreement, commitment, or duty, often leading to a breach of contract.