What Condition Is Necessary in a Constant Cost Industry

question 74

Multiple Choice

What condition is necessary in a constant cost industry?

• A) Prices of the industry's inputs do not change as the industry expands.
• B) Prices of the industry's inputs decline as the industry expands.
• C) Prices of the industry's inputs rise as the industry expands.
• D) There are barriers that prevent new firms from entering such an industry.

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Definitions:

Margins

The difference between the cost of goods sold and the selling price, indicating the profit per unit sold.

Emissions

The release of pollutants into the air, including those from industrial processes, transportation, and other sources that can harm human health and the environment.

Production Process

A set of operational activities and tasks involved in the conversion of raw materials into finished products or services.

Local Iron Ore

Iron ore mined within a specific geographic area, typically used in steel production within the same region to reduce transportation costs and support local industries.