1.) Economies of scale refer to
A.) the minimum point on the short-run average total cost
curve
B.) the flat portion of the long-run average total cost
curve.
C.) a decrease in the long-run average total cost of production
as output increases.
D.) a and b
E.) none of the above
.
2.) Minimum efficient scale refers to the
A.) minimum size plant in any given industry
B.) minimum point on the short-run average total cost curve
C.) output level when...
Please describe and give examples for each of the following
micro-economic terms:
Economies of scale (economies of mass production)
Economies of scope
Minimum efficient scale
Long run average cost
Constant returns to scale
Increasing returns to scale
Decreasing returns to scale
Average variable cost
Total fixed cost
Total variable cost
Marginal cost
Average Cost
Between "Diminishing Returns and the Production
Function" and Economies of Scale and Long-Run Costs", Which two
economics concepts of production theory can be used by business
owners to decide on key issues affecting their firms? How these two
concepts are related?
1.Explain what is meant by economies of scale and economies of
scope.
2. Give two examples of what would cause the short-run average
total cost to shift up. Give two examples of what would cause the
short-run average total cost to shift down. Draw both
scenarios.
Monopoly Vs. Perfect
Competition
Monopolists do not produce at minimum efficient scale in the
short run or long run
Monopolists are not allocatively efficient
Monopolists have the ability to earn profits in the long
run
Our main concern about monopoly power is that you have power you
will use it for your own benefit. Monopolists, therefore, produce
"too little" which is sold at "too high" a price.
Draw the case of:
the Price Setter
Profit Maximizer
Profit < 0
1. What are economies of scale? How do economies and
diseconomies of scale influence the shape of the long run cost
curves? How do economies of scale relate to indivisible setup
costs? What are diseconomies of scale and how do they arise?