If a Firm Experiences Constant Returns to Scale Throughout

question 92

Multiple Choice

If a firm experiences constant returns to scale throughout:

• A)the long run average total cost curve is a negatively sloped curve.
• B)the short run average total cost curves are tangential to the long run average total cost curve at a point on their positively sloped portion.
• C)the short run average total cost curves are tangential to the long run average total cost curve at their minimum points.
• D)the short run average total cost curves are tangential to the long run average total cost curve at a point on their negatively sloped portion.
• E)the long run average total cost falls to zero.

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Definitions:

Compensatory Damages

Monetary compensation awarded to a plaintiff to indemnify actual losses, expenses, or harm suffered due to the defendant's wrongful conduct.

Punitive Damages

Monetary compensation awarded to an injured party that goes beyond that which is necessary to compensate for losses and is intended to punish the wrongdoer.

Punitive Damages

Financial compensation awarded to a plaintiff in a lawsuit, exceeding simple compensation and intended to punish the defendant for egregious wrongdoing.

Wealth

A measure of the value of all assets of worth owned by a person, community, company, or country.