Which of the Following Is True in the Typical Firm

question 90

Multiple Choice

Which of the following is true in the typical firm if economies of scale are relatively important in an industry?

• A)Marginal cost curve will decline continuously until it reaches minimum efficient scale.
• B)Long-run average cost curve will begin rising before it reaches minimum efficient scale.
• C)Long-run average cost curve will reach a minimum at a level of output that leaves room for a large number of firms to enter the industry.
• D)Long-run average cost curve will reach a minimum at a level of output that is a relatively large fraction of total industry sales.

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Definitions:

DOT 3

A type of brake fluid specified by the Department of Transportation, characterized by its boiling point and chemical composition suitable for standard braking systems.

Rubber Master Cylinder Cap Seal

A rubber seal located on the cap of a master cylinder in a hydraulic system, designed to prevent leakage of brake fluid and contamination from entering.

Brake Fluid Contamination

Occurs when unwanted substances enter the brake fluid, potentially causing brake system failure or reduced performance.

Fluid Overheating

A condition where a vehicle's fluid, such as oil or coolant, exceeds its normal operating temperature, potentially leading to damage or system failure.