When a Firm Increases Its Plant Size in the Long

question 85

Multiple Choice

When a firm increases its plant size in the long run and its per-unit costs fall, this is called

• A) diminishing returns and is shown by the downward-sloping portion of the MP curve (or the upward-sloping portion of the MC curve).
• B) constant returns to scale and is shown by the flat portion of the LRATC curve.
• C) diseconomies of scale and is shown by the upward-sloping portion of the LRATC curve.
• D) economies of scale and is shown by the downward-sloping portion of the LRATC curve.

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Definitions:

Fundamental Attribution Error

The cognitive bias of attributing other people's actions to their character or disposition, while attributing one's own actions to situational factors.

Psychological Contract Bias

The tendency for misunderstandings or misinterpretations to occur regarding the unwritten and unspoken expectations between employees and employers.

Hypocrisy Attribution Dynamic

A psychological pattern where individuals judge others as hypocritical without recognizing similar behaviors within themselves.

Factitious Disorder

A mental disorder in which a person acts as if they have a physical or mental illness when they are not really sick.