The Two Phenomena That Help Explain the Experience Curve Are

question 19

Multiple Choice

The two phenomena that help explain the experience curve are:

• A)learning effects and economies of scale.
• B)technology inputs and economies of scale.
• C)wealth transfers and learning effects.
• D)wealth transfers and technology inputs.

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Definitions:

Law of Diminishing Returns

An economic principle stating that as investment in a particular area increases, the rate of profit from that investment, after a certain point, cannot continue to increase if other inputs remain at a constant.

Average Total Costs

The cost of producing each unit, calculated by dividing the overall production expense by the number of units produced.