Economies of Scale in the Production of a Good Implies

question 10

Multiple Choice

Economies of scale in the production of a good implies that:

• A)the long-run average cost of production rises as the scale of operation expands.
• B)the marginal cost of production falls below zero as the scale of operation contracts.
• C)the long-run average cost of production falls as the scale of operation expands.
• D)the long-run average cost of production remains the same as the scale of operation increases.
• E)the marginal output decreases as the amount of a factor of production is incrementally increased.

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Definitions:

Toxic Material

Toxic material refers to substances that can cause harm to living organisms through chemical reactions or other mechanisms when absorbed, ingested, inhaled, or come into contact with skin.

Product Liability

Legal responsibility of manufacturers and sellers for defects in the goods they provide, leading to injury or damage.

Due Care

Due care refers to the effort made by an individual or entity to avoid harm to other people or their property, acting with the prudence and attention that a reasonable person would exercise in similar circumstances.

Product Liability

The legal liability a manufacturer or trader incurs for producing or selling a faulty product.