The key assumption that distinguishes a constant cost industry from other types of industries is that
a. firms can earn only a normal profit in the long run
b. each firm's ATC curve is unaffected by changes in industry output
c. each firm has a horizontal long-run average total cost curve
d. there are no economies of scale available to the firms in the industry
e. each firm faces a horizontal demand curve for its output
B
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In a coin toss bet, where both heads and tails are equally likely, you win a $3 on heads but lose $1 on tails. The expected value of the bet is
a. $0.50 b. -$0.50 c. $1.00 d. $0.00
Which of the following was the result of the Federal Reserve’s purchase of mortgage-backed securities in 2009?
A. MBS interest rates declined, home mortgage rates declined, and the Fed turned a profit on these operations. B. MBS interest rates declined, home mortgage rates declined, but the Fed had a loss on these operations. C. MBS interest rates increased, home mortgage rates declined, and the Fed turned a profit on these operations. D. MBS interest rates increased, home mortgage rates increased, but the Fed had a loss on these operations.