In the Long Run a Company That Produces and Sells

question 335

Multiple Choice

In the long run a company that produces and sells popcorn incurs total costs of $1,050 when output is 90 canisters and $1,200 when output is 120 canisters. The popcorn company exhibits

• A)diseconomies of scale because total cost is rising as output rises.
• B)diseconomies of scale because average total cost is rising as output rises.
• C)economies of scale because total cost is rising as output rises.
• D)economies of scale because average total cost is falling as output rises.

Understand how to calculate Return on Investment (ROI) and interpret its value.

Understand the concept of residual income and how it is calculated.

Comprehend the importance of the minimum required rate of return in investment decisions.

Analyze and differentiate between the investment preferences of division managers versus corporate management in a decentralized organization.

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Definitions:

Inner-City Gang-Related

Refers to phenomena, activities, or issues specifically connected to street gangs within urban (inner-city) areas, often involving crime, violence, and community impact.

Hostile Attribution Bias

The tendency to attribute hostile intent to others’ actions, even when others’ intentions are innocent.

Aggressive Behaviors

Actions intended to cause harm or discomfort to others, often as a means of asserting power or expressing frustration.

Violent Video Games

Electronic games involving graphic and often realistic portrayals of physical conflict, which may include the use of weapons and causing harm to others in the game.