Economies of Scale Exist Where the Long-Run Average Cost Curve

question 323

Multiple Choice

Economies of scale exist where the long-run average cost curve is

• A) horizontal.
• B) downward sloping.
• C) upward sloping.
• D) tangent to the marginal cost curve.

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Definitions:

Political Risk

The risk of loss due to political instability or changes in government policy that can affect investments and business operations.

Governmental Actions

Decisions or interventions by government agencies that can affect the economy, businesses, and various segments of society.

International Assets

Financial or physical assets located in different countries from where an investor or company is based, adding diversification to an investment portfolio.

Absolute Purchasing Power Parity

A theory that suggests that in the absence of transaction costs and barriers to trade, identical goods should have the same price in different countries.