Use the Following Graph to Answer the Following Questions

question 132

Multiple Choice

Use the following graph to answer the following questions.

-A firm expands its scale of production and finds that its long-run average total cost curve looks like LRATC3.It might look this way because the firm

• A) is able to pay its employees less.
• B) adds several additional layers of management,which increase its costs.
• C) is able to reduce its tax burden.
• D) is able to produce output more efficiently.
• E) is able to sell more output.

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Definitions:

Accounts Receivable

Amounts owed to a business for services performed or goods delivered.

Percentage Increase

A measure of how much a certain quantity grows over a specific period, expressed as a percentage of the original amount.

Balance Sheet

A financial statement that summarizes a company's assets, liabilities, and shareholders' equity at a specific point in time.

Return on Investment

A measure used to evaluate the efficiency or profitability of an investment, calculated as net profit divided by initial cost.