The Minimum Efficient Scale Is

question 14

Multiple Choice

The minimum efficient scale is

• A)the level of output where diminishing returns have not set in yet.
• B)the plant size that yields the most profit.
• C)the level of operation where long-run average costs are lowest.
• D)the smallest output level where the firm finally reaches productive efficiency.

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Definitions:

Net Loss

The amount by which expenses exceed revenues.

Net Income

The amount of money remaining after all operating expenses, taxes, and dividends have been subtracted from total revenue.

Fair Value

An estimate of the price at which an asset or liability could be exchanged between knowledgeable, willing parties in an arm's length transaction.