As a Firm Expands Its Output from Zero

question 98

Multiple Choice

As a firm expands its output from zero:

• A) marginal wage of labour increases.
• B) it suffers from the diseconomies of scale.
• C) it has to pay wages, rent and electricity to cover the variable costs.
• D) no change in the cost is occurring.

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Definitions:

Evaluate Results

The process of analyzing outcomes to determine the effectiveness of actions taken and to inform future decisions.

Alternative Courses of Action

Different strategies or options available to an individual or organization when making decisions or solving problems.

Availability Bias

A cognitive bias that causes people to overestimate the importance or frequency of information that is readily available to them.

Confirmation Error

A cognitive bias that leads individuals to favor information or interpretations that confirm their pre-existing beliefs or hypotheses.