Question

18. Which of the following is most accurate about the Minimum Encient Scale (MES) of arm? Because a firm has various short-run average cost curves. It also has various MES scales. MES is the scale of operation at which diseconomies of scale starts to dominate. OMES is the scale of operation where at least one short run average cost starts to increase Specialization of labor can contribute to a firm's productivity only after it has reached its MES. D Question 19 19. How can we determine a form is in the stage of Economies of Scale? Its long run average cost is decreasing as output increases. Its total profit is increasing as output increases Its average revenue is increasing as output increases All of its short-run average costs are decreasing as outputs increase Question 20 20. In economics, the long run is a time period longer than one financial year in which all fixed costs have been recovered in accounting book in which a manager can freely adjust all inputs at the end of which all people who work now have retired

Answer 1

a) "B"

Minimum efficient scale is the point after which the diseconomies of scale start to dominate in the market.

b) "D"

All the given statements are true about the economies of scale in the firms.

c) "C"

in the long run all the inputs in the market can be changed.