Which of the following is a reason for economies of scale?
A) Fixed costs are spread out as volume increases.
B) The law of diminishing returns does not take effect.
C) Input productivity increases as a result of greater specialization.
D) There is greater savings in transportation costs.
C
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What area in the above figure is the producer surplus at the efficient quantity?
A) A B) A + B + C C) F D) D + E + F
Refer to the accompanying figure. It is efficient for this farmer to:
A. grow 1,000 bushels of wheat and 500 bushels of corn. B. grow 250 bushels of wheat and 500 bushels of corn. C. grow 500 bushels of wheat and 500 bushels of corn. D. grow 500 bushels of wheat and 250 bushels of corn.
The addition to total costs associated with the production of one more unit of output is referred to as
A) average cost. B) marginal cost. C) opportunity cost. D) overhead cost.
Refer to the table. The multiplier is:
A. 5.
B. 4.
C. 3.
D. 2.