If the Economy Is Characterized by Constant Returns to Scale,then

question 50

Multiple Choice

If the economy is characterized by constant returns to scale,then a

• A)doubling of inputs will lead to a more than two-fold increase in output.
• B)doubling of inputs will lead to a constant output.
• C)doubling of inputs will lead to a two-fold increase in output.
• D)doubling of inputs will lead to a less than two-fold increase in output.

Recognize the impact of input costs on the supply of products.

Analyze the effect of changes in supply and demand on equilibrium price.

Identify the role of expectations and number of suppliers on market supply.

Understand the impact of government policies on supply.

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Definitions:

Consolidation Entry G

A specific journal entry made to eliminate intercompany transactions and balances when preparing consolidated financial statements.

Intra-entity Transfer

Refers to the movement of goods, services, or funds within different parts of the same entity.

Depreciable Asset

An asset that loses value over time due to usage, wear and tear, or obsolescence, and is subject to depreciation accounting to allocate its cost over its useful life.

Noncontrolling Interest

A portion of the equity in a subsidiary not owned by the parent company, representing minority shareholders' interest in the subsidiary's net assets.