Nathan Owns a Coffee-Roasting Company

question 40

Multiple Choice

Nathan owns a coffee-roasting company. If he increases the size of his company and experiences constant returns to scale as a result, his long-run average total cost curve should be:

• A) vertical.
• B) downward-sloping.
• C) upward-sloping.
• D) horizontal.
• E) U-shaped.

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Definitions:

Land Account

An account used in accounting to record the cost of land owned by a company, which is a non-depreciable asset.

Unamortized Patent

The portion of a patent's cost that has not yet been expensed through the process of amortization.

Adjustment Necessary

A correction or modification required to ensure accuracy, typically in the context of financial records or statements.

Patent Account

A patent account is an intangible asset account that records the costs associated with the acquisition and registration of patents over their useful lives.