Module 8 Video/ Other

Question 1

economies of scale

Answer 1

average costs decrease as output increases

Question 2

constant returns to scale

Answer 2

average costs are constant as output increases

Question 3

diseconomies of scale

Answer 3

average costs increase as output increases

Question 4

a firm can minimize the cost of production by choosing the combination of labor and capital that makes the marginal product of labor per dollar equal

Answer 4

to the marginal product of capital.