If General Electric finds that when it doubles both its plant size and the amount of associated inputs, its output level does not double, then
a. the law of diminishing returns is in effect
b. long-run average costs must be decreasing
c. the firm is experiencing diseconomies of scale
d. the firm should increase production
e. the firm is experiencing constant returns to scale
C
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Life-cycle saving is saving:
A. to pay life-insurance premiums. B. for protection against unexpected setbacks, such as the loss of a job or a medical emergency. C. for the purpose of leaving an inheritance. D. to meet long-term objectives, such as retirement, college attendance, or the purchase of a home.
Suppose a firm can produce 70 units of a product, Zenia, by combining labor, land, capital, and entrepreneurial ability, as in the four alternative techniques shown in the table below. Assume further that the firm can hire labor at $3 per unit, land at $3 per unit, capital at $6 per unit, and entrepreneurship at $9 per unit. Techniques ABCDLabor41065Land5333Capital5244Entrepreneurship1111 Refer to the provided table. If the price of labor declines from $3 to $2 per unit, then what is the least costly way of producing Zenias?
What will be an ideal response?