QUESTION 2 A firm is considering changing its plant size. It calculates the amount of output it would be able to produce and the total cost for various plant sizes, as shown in the accompanying table. If the firm is currently using plant size C, the firm is experiencing which of the following? Plant Size Quantity Total Cost (S) A 1 10 B 10 80 100 900 D 200 2,000 500 5,500 F 1,000 15,000 O economies of scale o diseconomies of scale O constant returns to scale O diminishing marginal product O increasing marginal product

Managerial Economics: A Problem Solving Approach
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Author:Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike Shor
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Chapter7: Economies Of Scale And Scope
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QUESTION 2
A firm is considering changing its plant size. It calculates the amount of output it would be able to produce and the total cost for various plant sizes, as shown
in the accompanying table. If the firm is currently using plant size C, the firm is experiencing which of the following?
Plant Size
Quantity
Total Cost ($)
A
1
10
10
80
C
100
900
200
2,000
500
5,500
F
1,000
15,000
economies of scale
O diseconomies of scale
constant returns to scale
O diminishing marginal product
O increasing marginal product
Transcribed Image Text:QUESTION 2 A firm is considering changing its plant size. It calculates the amount of output it would be able to produce and the total cost for various plant sizes, as shown in the accompanying table. If the firm is currently using plant size C, the firm is experiencing which of the following? Plant Size Quantity Total Cost ($) A 1 10 10 80 C 100 900 200 2,000 500 5,500 F 1,000 15,000 economies of scale O diseconomies of scale constant returns to scale O diminishing marginal product O increasing marginal product
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