The Value of the Output Produced in an Economy Reflects

question 30

True/False

The value of the output produced in an economy reflects the value of the income generated by the factors of production used to produce that output.

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Definitions:

Economies of Scale

Cost benefits that companies gain from their operation size, where the cost for each unit of production typically falls as the scale expands.

Constant Returns to Scale

A situation in production where increasing all inputs by a certain factor results in output increasing by the same factor.

Average Total Cost

The total cost divided by the quantity of output produced; it includes all variable and fixed costs.

Minimum Efficient Scale

The smallest scale of production at which long-run average total costs are minimized.