Long-Run Average Cost Is Never Greater Than Short-Run Average Cost

question 38

Multiple Choice

Long-run average cost is never greater than short-run average cost because in the long run,

• A) capital costs equal zero.
• B) the firm can move to the lowest possible isocost curve.
• C) wages always increase over time.
• D) wages always decrease over time.

Understand the dynamics of deregulation on economic efficiency.

Analyze the consequences of pork-barrel politics and the principal-agent problem in public choice theory.

Comprehend the concept of regulatory capture and its implications in government-industry relations.

Examine the special-interest effect and its impact on lobbying efforts.

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Definitions:

Dopamine

A neurotransmitter involved in reward, motivation, memory, attention, and even regulating body movements.

Cocaine

A potent stimulant drug derived from the leaves of the coca plant, traditionally used as an analgesic but often abused for its euphoric effects.

Neurotransmitter System

A network of neurons and synapses in the brain and body that use chemical messengers, known as neurotransmitters, to transmit signals across synapses to communicate information.

Heroin

An opioid drug made from morphine, highly addictive and illegal, known for its euphoric effects but also for severe health risks and dependency.