Exhibit 6-14 Cost curves
-In Exhibit 6-14,the U-shaped LRAC curve indicates which of the following as quantity increases from 0 to 4,000?
A) Diseconomies of scale; constant returns to scale; economies of scale.
B) Constant returns to scale; economies of scale; diseconomies of scale.
C) Economies of scale; constant returns to scale; diseconomies of scale.
D) Diseconomies of scale; economies of scale; constant returns to scale.
E) Economies of scale; diseconomies of scale; constant returns to scale.
Correct Answer:
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Q202: Exhibit 6-17 Long-run average cost curve
Q203: Exhibit 6-14 Cost curves Q204: Exhibit 6-16 Long-run average cost curves Q205: Exhibit 6-14 Cost curves Q205: Economic profit equals accounting profit minus implicit Q206: Exhibit 6-17 Long-run average cost curve Q208: Exhibit 6-15 Long-run average cost Q208: Constant returns to scale exist over the Q212: Exhibit 6-15 Long-run average cost Q220: If economic profit is zero, then a
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