Diseconomies of Scale Occur When

question 201

Multiple Choice

Diseconomies of scale occur when

• A) long-run average costs rise as a firm increases its output.
• B) long-run average costs fall as a firm expands its plant size.
• C) short-run average costs rise as a firm expands its plant size.
• D) long-run labour costs rise as a firm increases its output.

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Definitions:

Par Value

The nominal or face value of a stock or bond as stated by the issuer, often used in the accounting of capital accounts.

Dividend

A share of a company's profits paid out to its shareholders, typically in the form of cash or additional stock.

Cumulative Preferred Stock

A type of preferred stock where missed dividend payments accumulate and must be paid out before any dividends can be issued to common stockholders.

Dividend

A portion of a company's earnings that is distributed to shareholders as a reward for their investment.