The upward-sloping part of the long-run average total cost curve is a result of:
a. economies of scale
b. diseconomies of scale.
c. constant returns to scale.
d. diminishing marginal returns.
b
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Fill in the blank: Other things constant, the introduction of generic (non-brand name) drugs on the market tends to ________ the price elasticity of demand for brand name drugs
A) increase B) decrease C) leave unchanged D) alter for the better
Suppose that the interest rate paid to savers increases. As a result, Tom wishes to save less. This suggests that, for Tom,
A) the substitution effect is greater than the income effect. B) the income effect is greater than the substitution effect. C) utility maximization is not occurring. D) future consumption is a luxury.
Which is NOT an example of moral hazard
a. people eat more at all-you-can-eat buffets b. loggers clear-cut a tract of land rather than when paying per tree felled c. Drivers of heavier, safer cares are less likely to run stop signs d. workers on commission work harder than those paid an hourly wage
With a monopoly, the total surplus is lower than it would be with a perfectly competitive industry
a. True b. False Indicate whether the statement is true or false