Which of the Following Explains Why Long-Run Average Cost at First

question 414

Multiple Choice

Which of the following explains why long-run average cost at first decreases as output increases?

• A)diseconomies of scale
• B)less-efficient use of inputs
• C)fixed costs becoming spread out over more units of output
• D)gains from specialization of inputs

---

Definitions:

Operating Activities

Activities that relate directly to the business's primary operations and functions, including sales, distribution, and production, influencing the day-to-day profitability.

Cash Receipts

The collection of money, including cash and checks, received by a business during a specific period.

Plant Assets

Long-term tangible assets used in the production of goods and services, such as buildings, machinery, and equipment.

Cash Flows

The net amount of cash and cash equivalents being transferred into and out of a business.