When Firm A increased its production last year, its average total cost of production decreased. On the other hand, Firm B also increased its production last year, but its average total cost of production increased. Considering the given situation, which of the following statements is true of the two firms?
a. The size of the plant in Firm A is smaller than the size of the plant in Firm B.
b. Firm A is operating with increasing returns to scale, while Firm B is operating with decreasing returns to scale.
c. Firm A is operating with decreasing returns to scale, while Firm B is operating with increasing returns to scale.
d. Firm A invests more on labor and cheaper variable costs, while Firm B invests more in expensive machinery.
b
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A price ________ is a regulated ________ that must be set below the equilibrium price to have an effect
A) floor; price B) floor; quantity C) ceiling; price D) ceiling; quantity
For economists, "myopia" refers to:
A. visual nearsightedness. B. people's difficulty in conceptualizing the future. C. people's tendency to put too much emphasis on the future and ignore important present concerns. D. people's tendency to focus on microeconomic concerns because of an inability to conceptualize macroeconomics.