Which of the following asserts that expanding all inputs proportionately does not change the average cost of production?
a. Constant returns to scale
b. Diseconomies of scale
c. Long-run implicit costs
d. Economies of scale
a. Constant returns to scale
Constant returns to scale asserts that expanding all inputs proportionately does not change the average cost of production.
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In the model of monopolistic competition, an increase in industry output will cause individual firms' demand curves to become ________, which will ________ demand for higher-priced goods and ________ demand for lower-priced goods
A) flatter; reduce; increase B) steeper; reduce; increase C) flatter; increase; reduce D) steeper; increase; reduce E) horizontal; reduce; reduce
In terms of utility theory, "equilibrium" in the real world means that
a. households are consuming as much of every commodity as they would like b. households have spent their incomes in such a way that their overall satisfaction is maximized c. households have spent their incomes in such a way that their marginal utility is maximized d. households have spent their incomes in such a way that their marginal utility is zero for every product consumed e. households have spent their incomes in such a way that their total utility is zero
In the circular flow model, money flows from the business sector to the household sector through the:
a. product market. b. capital market. c. goods market. d. services market. e. resource market.
Vertical equity refers to a tax system in which individuals with similar incomes pay similar taxes
a. True b. False Indicate whether the statement is true or false