When a Firm Experiences Increasing Returns to Scale

question 52

Multiple Choice

When a firm experiences increasing returns to scale

• A)its AFC will decrease.
• B)its AFC will increase.
• C)its AC will increase.
• D)its AC will decrease.

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Definitions:

Self-Serving Bias

The tendency to attribute positive outcomes to one's own actions and negative outcomes to external factors.

Credit

The provision of resources (such as money) now in exchange for repayment in the future, with or without interest.

Blame

The act of holding someone responsible for something wrong or unfortunate.

Stereotyping

The oversimplified and generalized beliefs or expectations about individuals based on their membership in a certain group.