When There Are Economies of Scale in the Production of a Product

question 120

Multiple Choice

When there are economies of scale in the production of a product, the long-run average total cost curve

• A)increases as output increases.
• B)sometimes increases and sometimes decreases as output increases.
• C)does not change as output increases.
• D)declines as output increases.
• E)is horizontal.

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Definitions:

Preventive Actions

Measures taken in advance to eliminate or reduce the likelihood of potential problems or risks in processes or operations.

Corrective Actions

Steps taken to eliminate the causes of existing nonconformities or undesirable situations, with the goal of preventing recurrence.

Yardsticks

Standards or measures used for comparison or evaluation.

Objectives

Specific, measurable goals that an organization or individual aims to achieve within a specific timeframe to drive performance.