Economies of scale are indicated by:
A. the rising segment of the average variable cost curve.
B. the difference between total revenue and total cost.
C. the declining segment of the long-run average total cost curve.
D. a rising marginal cost curve.
Answer: C
You might also like to view...
A (non-price discriminating) monopolist with zero marginal cost but recurring fixed costs may end up not producing even if it would be efficient for him to produce.
Answer the following statement true (T) or false (F)
In the long-run the firm gets to choose which short-run curve it wants to use
a. True b. False Indicate whether the statement is true or false
Suppose the equilibrium price of a tube of toothpaste is $2, and the government imposes a price floor of $3 per tube. As a result of the price floor, the
a. demand curve for toothpaste shifts to the left. b. supply curve for toothpaste shifts to the right. c. quantity demanded of toothpaste decreases, and the quantity of toothpaste that firms want to supply increases. d. quantity supplied of toothpaste stays the same.
Suppose the banks in the Federal Reserve System have $100 million in transactions accounts and the reserve requirement is 0.10. Ceteris paribus, if the reserve requirement is decreased to 0.07, then excess reserves will increase by:
A. $3 million. B. $7 million. C. $10 million. D. $700 billion.