Question

Some capital equipment such as a moving assembly line only comes in one size. This usually tends to create

a. a significant diseconomy of scale at the plant level

b. a significant diseconomy of scale at the firm level

c. a smaller MOS

d. an economy of scale

e. an antitrust case

6. What happens to the firm’s long run average cost (LAC) as it produces more and there is are economies of scale?

a. LAC changes, but we cannot tell how from this information

b. LAC declines

c. LAC increases

d. LAC remains constant

Piece rate pay in industrial firms is not very common because

a. workers become lazy when they are paid this way
b. it is usually difficult devising a piece rate system for manufacturing and services jobs
c. it is illegal to pay workers in manufacturing jobs piece rate wages
d. firms do not like the idea of having no monitors watching workers

Answer 1

Answer 1

The correct answer is Option A

Because the moving assembly line actually provide a advantage over the production by making the production or assembly more efficient and mannerly but as it come in one size so it have a impression that would create a diseconomy at the plant level and the diseconomies take place when the econmy of scale no longer function in the firm and the average cost decreases as the output increase which is a economy of scale but at plant level it will create diseconomy as it come in only one size .

Answer 2

The correct answer is Option B i-e LAC declines

Because , the average cost decrease as the output of the firm increases .It is best shows by the economy of scale curve which depict that at economy of scale when the output increases ,, the LAC decreases .

Answer 3

The correct answer is Option B i-e it is usually difficult devising a piece rate system for manufacturing and services jobs

Piece rate pay in industrial firm is a practice that worker will be given or paid for each product unit made or opration performed like unit made , kilometer driver etc etc .Now Because it is usually difficult devising a piece rate system for manufacturing and services jobs and It puts immense pressure on all the employees and Sometimes even more supervision is required:

Have a good day !