The Slope of the Long-Run Supply Curve in a Decreasing-Cost

question 11

Multiple Choice

The slope of the long-run supply curve in a decreasing-cost industry is _____.

• A)zero
• B)negative
• C)positive
• D)infinite

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Definitions:

Economies of Scale

The cost advantage that arises with increased output of a product, where average costs start to fall as production scales up.

Marginal Returns

denotes the additional output obtained by adding one more unit of a specific input, while keeping other inputs constant.

Diseconomies of Scale

The scenario where costs start increasing as a company or project becomes too large, leading to inefficiency.

Bureaucratic

Relating to a system of government in which most of the important decisions are made by state officials rather than by elected representatives.