Which of the Following Statements Is TRUE

question 105

Multiple Choice

Which of the following statements is TRUE?

• A) In the long run, the average cost curve is always downward sloping.
• B) In the long run, the quantities of all inputs are fixed.
• C) In the long run, the firms' fixed costs are greater than its variable costs.
• D) In the long run, all costs are variable costs.

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Definitions:

Long-Term Liabilities

Company debts that are payable beyond a year from now.

Capital Leases Payable

The liability account that records the present value of future lease payments for assets obtained through capital leases.

Unearned Revenues

Money received by a company for goods or services yet to be delivered or performed.

Working Capital

The difference between a company's current assets and current liabilities, indicating the short-term financial health of the business.