Which of the Following Is a Characteristic of Economies of Scale

question 24

Multiple Choice

Which of the following is a characteristic of economies of scale?

• A)The average cost declines as output increases
• B)The average cost increases as output increases
• C)The average cost remains constant as output increases
• D)The average costs are cheaper when a firm produces a wider variety of goods
• E)The average cost curve takes the form of a U-shape

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Definitions:

Individual Actors

Single entities, such as persons or companies, that perform actions or make decisions in economic, social, or political contexts.

Public Choice Analysis

A study of decision-making behaviors in non-market settings, emphasizing how public decisions and policies are made.

Re-elected

This occurs when an official or incumbent is chosen again by the voters to serve another term in the same office.

Economic Efficiency

The optimal allocation of resources to maximize production and fulfill consumer needs in a way that minimizes waste and inefficiency.