At the minimum efficient level of production:
A. a firm will be at the only short-run economically efficient level of production.
B. production has expanded to make the firm profitable at any price.
C. the market has expanded sufficiently to take advantage of all economies of scale.
D. a firm will be at the only technically efficient level of production.
Answer: C
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Ignoring any supply-side effects, to close an inflationary gap of $100 billion with a government expenditure multiplier of 5, the government could
A) decrease government expenditure on goods and services by $20 billion. B) decrease government expenditure on goods and services by $100 billion. C) lower taxes by $100 billion. D) increase government expenditure on goods and services by $20 billion. E) lower taxes by more than $20 billion.
Refer to the figure above. What is the market-wide consumer surplus when the market price of wine is $18?
A) $36,000 B) $3,000 C) $45,000 D) $210,000
Refer to the scenario above. What will the outcome of this game be?
A) Both players will choose black. B) Both players will choose white. C) Arthur will choose white and Catherine will choose black. D) Catherine will choose white and Arthur will choose black.
The price elasticity of demand for oil is estimated at 0.05. This value means a 10 percent increase in the
A) quantity of oil demanded will result from a 0.5 percent increase in the price of oil. B) quantity of oil demanded will result from a 0.5 percent decrease in the price of oil. C) price of oil will increase the quantity of oil demanded by 0.5 percent. D) price of oil will decrease the quantity of oil demanded by 0.5 percent.