- Refer to the Figure below. The production function of the firm displays constant returns to scale when output is increased from _____.
The following figure shows the long-run average cost curve of a
firm.
a) A to E
b) C to D
c) D to E
d) A to B
e) B to D
Homework Answers
Answer :- Option 'b' is the correct Answer
The production function of the firm displays constant returns to scale when output is increased from C to D.
Constant return to scale means a increase in a firm's scale of production has no effect on costs per unit produced.
Technically, the term means that the quantitative relationship between input and output stays constant, or the same, when output is increased.
Constant returns to scale mean that the firm's long-run average cost curve remains flat.
Add Answer to:
Refer to the Figure below. The production function of the firm
displays constant returns to scale...
22. Which of the following is true for a firm that enjoys economies of scale? a. Marginal cost is increasing as output i...
22. Which of the following is true for a firm that enjoys economies of scale? a. Marginal cost is increasing as output increases. b. Average total cost is falling as output increases. c. Marginal cost is constant as output increases. d. Marginal revenue is falling as output increases. 23. The figure below shows short-run average total cost curves for a firm under four different production technologies. Assume that there are only four different technologies that the firm could use. Refer...
8:587 18:26:20 Exit D 24. The figure below shows short-run average total cost curves for a...
8:587 18:26:20 Exit D 24. The figure below shows short-run average total cost curves for a firm under four different production technologies. Assume that there are only four different technologies that the firm could use. Price ATC, ATC ATC Q, Q.QQQQQ Quantity Refer to the figure above. Between the output quantity QA and QC, the long-run average total cost curve of the firm exhibits constant returns to scale diminishing marginal product diseconomies of scale economies of scale
These two question please Question 8 (1 point) When do constant returns to scale occur? when...
These two question please
Question 8 (1 point) When do constant returns to scale occur? when long-run total costs are constant as output increases when long-run average total costs are constant as output increases when the firm's long-run average-cost curve is falling as output increases when the firm's long-run average-cost curve is rising as output increases Figure 13-4 The curves in this figure reflect information about the average total cost, average fixed cost, average variable cost, and marginal cost for...
1. For a constant returns to scale production function: a. marginal costs are constant but the...
1. For a constant returns to scale production function: a. marginal costs are constant but the average cost curve as a U-shape b. both average and marginal costs are constant c. marginal cost has a U-shape, average costs are constant d. both average and marginal cost curves are U-shaped 2. The production function q = 10K +50L exhibits: a. increasing returns to scale b. decreasing returns to scale c. constant returns to scale d. none of the above
A firm has a production function q = KL, where q is the quantity of output,...
A firm has a production function q = KL, where q is the quantity of output, K is the amount of capital and L is the amount of labor. a) Does this production function exhibit increasing, decreasing or constant returns to scale? b) Does the long-run cost function exhibit economies of scale or diseconomies of scale? c) Is the LR Average Cost curve increasing or decreasing with q?
__B__ 48. Economies of scale a. require inputs' MPP to fall as output increases (everything else...
__B__ 48. Economies of scale a. require inputs' MPP to fall as output increases (everything else equal). b. pertain to the long run only. c. refer to increased output generalized by an increase in the quantity of a single input. d. imply that the AC curve will fall continuously as output increases in the short run. __D__ 49. If in some production range average cost is rising, the firm is experiencing a. increasing returns to scale. b. decreasing returns to...
a. Suppose that a firm has the Cobb-Douglas production function = 12K0.75 0.25. Because this function...
a. Suppose that a firm has the Cobb-Douglas production function = 12K0.75 0.25. Because this function exhibits returns to scale, the long-run average cost curve is , whereas the long-run total cost curve is upward-sloping, with slope. b. Now suppose that the firm's production function is = KL. Because this function exhibits returns to scale, the long-run average cost curve is upward-sloping , whereas the long-run total cost curve is upward-sloping, with slope. a. Suppose that a firm has the...
Part 1: When a firm operates with economies of scale, average production costs: 1) rise when...
Part 1:
When a firm operates with economies of scale, average production
costs:
1) rise when the firm gets larger.
2) fall as the firm gets larger.
3) fall as the firm gets smaller.
4) are unaffected by firm size.
Part 2:
“U-shaped” long-run average cost curves show that as firms get
larger, they usually experience:
1) economies of scale.
2) constant returns to scale.
3) diseconomies of scale.
4) a, b, and c, in that order.
Part 3:
This...
A B Long Run AC Long-Run AC Long-Run AC $ per Unit تست است Quantity of...
A B Long Run AC Long-Run AC Long-Run AC $ per Unit تست است Quantity of Output Quantity of Output Quantity of Output Refer to the three figures above. Which figure, if any, shows a firm with a long run average cost curve that has an extended period of constant returns to scale? None of the graphs Figure A Figure B Figure C
Suppose the production function of a firm is given by q = L1/4K1/4. The prices of...
Suppose the production function of a firm is given by q = L1/4K1/4. The prices of labor and capital are given by w = $10 and r = $20, respectively. a) Write down the firm's cost minimization problem. b) What returns to scale does the production function exhibit? Explain c) What is the Marginal Rate of Technical Substitution (MRTS) between capital and labor? d) What is the optimal capital to labor ratio? Show your work. e) Derive the long run...
8:587 18:26:20 Exit D 24. The figure below shows short-run average total cost curves for a firm under four different production technologies. Assume that there are only four different technologies that the firm could use. Price ATC, ATC ATC Q, Q.QQQQQ Quantity Refer to the figure above. Between the output quantity QA and QC, the long-run average total cost curve of the firm exhibits constant returns to scale diminishing marginal product diseconomies of scale economies of scale
These two question please
Question 8 (1 point) When do constant returns to scale occur? when long-run total costs are constant as output increases when long-run average total costs are constant as output increases when the firm's long-run average-cost curve is falling as output increases when the firm's long-run average-cost curve is rising as output increases Figure 13-4 The curves in this figure reflect information about the average total cost, average fixed cost, average variable cost, and marginal cost for...
a. Suppose that a firm has the Cobb-Douglas production function = 12K0.75 0.25. Because this function exhibits returns to scale, the long-run average cost curve is , whereas the long-run total cost curve is upward-sloping, with slope. b. Now suppose that the firm's production function is = KL. Because this function exhibits returns to scale, the long-run average cost curve is upward-sloping , whereas the long-run total cost curve is upward-sloping, with slope. a. Suppose that a firm has the...
Part 1:
When a firm operates with economies of scale, average production
costs:
1) rise when the firm gets larger.
2) fall as the firm gets larger.
3) fall as the firm gets smaller.
4) are unaffected by firm size.
Part 2:
“U-shaped” long-run average cost curves show that as firms get
larger, they usually experience:
1) economies of scale.
2) constant returns to scale.
3) diseconomies of scale.
4) a, b, and c, in that order.
Part 3:
This...
A B Long Run AC Long-Run AC Long-Run AC $ per Unit تست است Quantity of Output Quantity of Output Quantity of Output Refer to the three figures above. Which figure, if any, shows a firm with a long run average cost curve that has an extended period of constant returns to scale? None of the graphs Figure A Figure B Figure C
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