What is the difference between diminishing marginal returns and diseconomies of scale?
What will be an ideal response?
Diminishing marginal returns is a short run concept. It occurs when increases in output become smaller and smaller as more units of a variable factor are combined with some fixed factor. Diseconomies of scale is a long run concept. It occurs when, as output increases, long-run average cost increases.
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The demand curve for dolls shows the quantity of dolls demanded
a. by suppliers of those dolls b. by U.S. consumers c. at the equilibrium price for dolls d. at each level of income e. at each possible price of dolls
Consider a firm with the following cost information: ATC = $15, AVC = $12, and MC = $14 . If we know that this firm has decided to produce Q = 20 by following the rule to maximize profits or minimize losses, then the price of the output is
a. $12 b. $14 c. $15 d. $20 e. indeterminate from the information given