If a Firm Experiences Economies of Scope

question 13

Multiple Choice

If a firm experiences economies of scope,

• A)its average cost falls as it increases output
• B)its average cost rises as it increases output
• C)average production costs fall when it produces more than one kind of product
• D)it should integrate vertically
• E)average production costs rise as it produces more kinds of products

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Definitions:

Morphine Sulfate

A potent opiate analgesic drug used to relieve severe pain by acting directly on the central nervous system.

Palliative

Intended to alleviate symptoms without curing the underlying disease.

Teratogenic

Relating to substances or factors that can cause congenital abnormalities or birth defects during fetal development.

Heparin

An anticoagulant medication used to prevent and treat blood clots in veins, arteries, or the lung.