When a Firm Finds That Its ATC of Production Decreases

question 209

Multiple Choice

When a firm finds that its ATC of production decreases as it increases production,this firm is said to be experiencing:

• A)profit maximization.
• B)economic profit.
• C)economies of scale.
• D)a barrier to entry.

---

Definitions:

Direct Payments

Cash transfers from governments to individuals or businesses for specific purposes, often used in agricultural subsidies or social welfare programs.

Agricultural Price Supports

Government interventions to stabilize or increase agricultural commodity prices through mechanisms such as subsidies, minimum price settings, or purchasing surplus.

Large-Scale Farmers

Farmers who operate extensive areas of land and generally engage in high-volume production of crops or livestock.

Farm Subsidies

Governmental aid programs aimed at supporting farmers and agricultural enterprises by enhancing their earnings, regulating the production of farm goods, and affecting the price and availability of these commodities.