In the Short Run, a Firm Will Eventually Experience Rising

question 164

Multiple Choice

In the short run, a firm will eventually experience rising per-unit costs because of

• A) economies of scale.
• B) diseconomies of scale.
• C) the law of supply.
• D) the law of diminishing returns.

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Definitions:

Purchase Discounts

Reductions in the price of goods that a buyer is entitled to for early payment or volume purchases.

Freight-In

Costs associated with bringing inventory to a business location, typically included in the inventory cost.

GAAP

Generally Accepted Accounting Principles; the standard framework of guidelines for financial accounting used in any given jurisdiction, commonly the U.S.

Income Statement

A financial statement that shows a company's revenues and expenses over a specific period, culminating in the net income.