Refer to the Accompanying Graph to Answer the Following Questions

question 146

Multiple Choice

Refer to the accompanying graph to answer the following questions.

-The average total cost (ATC) and average variable cost (AVC) converge as the level of output produced increases because

• A) the firm is able to purchase more capital and exploit economies of scale.
• B) the firm experiences gains in productivity from employee specialization.
• C) average total cost decreases as output increases.
• D) average fixed cost decreases as output increases.
• E) the firm is able to drive its competitors out of business by lowering its price.

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Definitions:

Doha Amendment

An amendment to the Kyoto Protocol that includes new carbon emission reduction commitments for participating countries and was adopted in Doha, Qatar.

Kyoto Protocol

An international agreement linked to the United Nations Framework Convention on Climate Change that commits its parties to reduce greenhouse gas emissions, based on the scientific consensus that global warming is occurring and that human-made CO2 emissions are significant contributors.

Ratified

Formally approved or confirmed, often referring to the process by which legislation or constitutional amendments become valid.

Clean Air Act

A United States federal law designed to control air pollution on a national level, aiming to protect and improve the nation's air quality and the stratospheric ozone layer.