In the Long Run Firm a Incurs Total Costs of $1,200

question 160

Multiple Choice

In the long run Firm A incurs total costs of $1,200 when output is 30 units and $1,600 when output is 40 units.Firm A exhibits

• A) diseconomies of scale because total cost is rising as output rises.
• B) constant returns to scale because average total cost is constant as output rises.
• C) diseconomies of scale because average total cost is rising as output rises.
• D) economies of scale because average total cost is falling as output rises.

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Definitions:

Sellers

Persons or organizations that provide products or services available for purchase within a marketplace.

Legislate

The act of making or enacting laws; the power or process through which laws are made by a government's legislative body.

True Burden

The actual economic impact of a tax or fiscal policy on individuals or entities, taking into account both direct and indirect effects.