When economies of scale exist:
a. per unit production costs increase as output expands
b. per unit production costs decline as output expands.
c. marginal cost must decrease as output expands.
d. per unit production costs remain constant as output expands.
b
You might also like to view...
How does price serve as a signal to resource owners?
What will be an ideal response?
If real GDP increased by 2% and nominal GDP increased by 1%, then output:
a. increased and the price level increased. b. increased and the price level decreased. c. decreased and the price level increased. d. decreased and the price level decreased.
Deregulation of the airline and trucking industry has (i) resulted in considerable entry of new firms or (ii) has forced workers in these industries to make large concessions on wages and working conditions.
A. i and ii B. i but not ii C. ii but not i D. neither i nor ii
Suppose two economists disagree about whether a particular tax cut is a good policy. The economist supporting the cut believes that it will increase economic growth. The other economist opposes it because he thinks it will have no effect on growth. The source of their disagreement in this case is most likely due to different:
A. levels of coldheartedness. B. value judgments. C. interpretation of Pareto optimality. D. interpretations of empirical evidence.