3. With constant returns to scale, long-run average total cost: a. must be decre

Question

3.  With constant returns to scale, long-run average total cost:

  a. must be decreasing.

  b. must be increasing.

  c. must equal long run marginal cost.

  d. is U-shaped.

  e. none of the above.

4. A monopolist

With constant returns to scale, long-run average total cost: must be decreasing. must be increasing. must equal long run marginal cost. is U-shaped. none of the above. A monopolist's downward-sloping demand curve has: average revenue always less than marginal revenue. marginal revenue always greater than the price. marginal revenue always less than the price. average revenue always less than the price. none of the above. For monopolistically competitive firms in long-run equilibrium, the demand curve must intersect average total cost at its minimum. the demand curve must be tangent to the average total cost curve at its minimum. at the profit-maximizing quantity, the demand curve must intersect the average total cost curve quantity. at the profit-maximizing quantity, the demand curve must be tangent to the average total cost curve.

Explanation / Answer

c. must equal long run marginal cost.

d. at the profit-maximizing quantity, the demand curve must be tangent to the average total cost curve.

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