Assume That You Observe the Long-Run Average Cost Curve of a Local

question 241

Multiple Choice

Assume that you observe the long-run average cost curve of a local Bookstores, a national chain. Starting from the point on the curve where output is zero and moving to the right, which of the following lists the behaviour of long-run average costs in the correct sequence (that is, which will be observed first, second, etc.) ?

• A) minimum efficient scale; economies of scale; constant returns to scale; diseconomies of scale
• B) economies of scale; constant returns to scale; diseconomies of scale; minimum efficient scale
• C) constant returns to scale; economies of scale; minimum efficient scale; diseconomies of scale
• D) economies of scale; minimum efficient scale; constant returns to scale; diseconomies of scale

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Definitions:

Ichak Adizes

An international consultant and scholar known for his work on management and leadership, specifically the Adizes Methodology for organizational transformation and lifecycle.

Embrace Problems

The mindset of viewing challenges and difficulties as opportunities for growth, learning, and innovation rather than obstacles to be avoided.

Surprise

A sudden and often unexpected event that necessitates an immediate and adaptative response from the affected parties.

Inertia

In physics, the tendency of an object to resist any change in its motion, including a change in speed or direction; in a figurative sense, a resistance to change or action.