Which of the Following Is Not a Benefit of Using

question 56

Multiple Choice

Which of the following is not a benefit of using models in decision making?

• A)They provide a standardized format for analyzing a problem.
• B)They serve as a consistent tool for evaluation.
• C)They are easy to use and less expensive than dealing with the actual situation.
• D)All of the above are benefits.
• E)None of the above is a benefit.

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Definitions:

Diseconomies of Scale

The phenomenon where production costs per unit increase as a firm's production increases.

Diminishing Returns

A principle stating that as more of a variable input is added to a fixed input, beyond some point, the additional output from the additional input will decrease.

Marginal Cost

The financial outlay required to create another unit of a good or service.

Average Total Cost

The total cost of production (fixed plus variable costs) divided by the number of goods produced, essentially the per unit production cost.