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Diseconomies of Scale Tend to Occur in Large Firms Because

Question 115

Multiple Choice

Diseconomies of scale tend to occur in large firms because


A) the many layers of management are cumbersome and because it is difficult to monitor employees
B) such firms are operating at inappropriate plant sizes for their output levels
C) such firms are operating at a point above their long-run average total cost curves
D) their ability to adjust their plant sizes is constrained by the existence of fixed inputs
E) they fail to garner all the possible gains from specialization

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