If Long-Run Costs Are Plotted on the Vertical Axis and Quantity

question 16

Multiple Choice

If long-run costs are plotted on the vertical axis and quantity of output plotted on the horizontal axis,a line that is perfectly horizontal implies:

• A)constant returns to scale.
• B)economies of scale.
• C)diseconomies of scale.
• D)inefficient use of capital.
• E)inefficient use of labor.

---

Definitions:

Guilds

Associations of artisans or merchants who control the practice of their craft in a particular town, historically significant for setting standards and protecting members' interests.

Unions

Organizations of workers that seek to defend and promote their members’ interests.

Agricultural Settlements

Communities primarily engaged in farming and agriculture, often located in rural areas.

Slash and Burn Agriculture

A method of agriculture where forests are cut and burned to create fields for temporary cultivation, often used in tropical environments.