Every point on a ________ represents the minimum cost at which the associated output level can be produced when the scale of plant can be changed.
A. marginal cost curve
B. long-run demand curve
C. U-shaped long-run average cost curve
D. long-run variable cost curve
Answer: C
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Answer the next question on the basis of the following production possibilities tables for two countries, Latalia and Trombonia:Latalia's Production Possibilities ABCDEPork (tons)43210Beans (tons)05101520Trombonia's Production Possibilities ABCDEPork (tons)86420Beans (tons)06121824If these two nations specialize on the basis of comparative advantage
A. Trombonia will produce beans and Latalia will produce pork. B. Latalia will produce beans and Trombonia will produce pork. C. Trombonia will produce both beans and pork. D. Latalia will produce both beans and pork and Trombonia will produce neither.
When Mexico suffered from capital flight in 1994, Mexico's real interest rate
a. fell and the peso appreciated. b. fell and the peso depreciated. c. rose and the peso appreciated. d. rose and the peso depreciated.
Suppose that there are two types of cars, good and bad. The qualities of cars are not observable but are known to the sellers. Risk-neutral buyers and sellers have their own valuation of these two types of cars as follows: Types of CarsBuyer's ValuationSeller's ValuationGood (50% probability)5,0004,500Bad (50% probability)3,0002,500Now suppose that sellers value a good car at $4,500 and a bad car at $2,500, and quality is not observed by the buyers. What is the highest price that risk-neutral buyers will offer for a used car if they recognize adverse selection?
A. $4,000 B. $3,000 C. $4,500 D. $2,500
Street entertainers face the free-rider problem when they perform because of the:
A. Law of Demand B. Diminishing marginal utility C. Nonexcludability characteristic D. Rivalry characteristic