1answer.
Ask question
Login Signup
Ask question
All categories
  • English
  • Mathematics
  • Social Studies
  • Business
  • History
  • Health
  • Geography
  • Biology
  • Physics
  • Chemistry
  • Computers and Technology
  • Arts
  • World Languages
  • Spanish
  • French
  • German
  • Advanced Placement (AP)
  • SAT
  • Medicine
  • Law
  • Engineering
Bezzdna [24]
1 year ago
11

If a firm has economies of scale, increasing the quantity produced will lead to: multiple choice 1 higher long run average costs

. lower long run average costs. lower short run average costs. higher profits.
Business
1 answer:
xeze [42]1 year ago
6 0

It results in lower short run average cost in economies of sale .

<h3>Economies of scale</h3>

Economies of scale refers to the situation where, as the quantity of output goes up, the cost per unit goes down. This is the idea behind “warehouse stores” like Costco or Walmart. In everyday language: a larger factory can produce at a lower average cost than a smaller factory. Figure 2 illustrates the idea of economies of scale, showing the average cost of producing an alarm clock falling as the quantity of output rises. For a small-sized factory like S, with an output level of 1,000, the average cost of production is $12 per alarm clock. For a medium-sized factory like M, with an output level of 2,000, the average cost of production falls to $8 per alarm clock. For a large factory like L, with an output of 5,000, the average cost of production declines still further to $4 per alarm clock.

One prominent example of economies of scale occurs in the chemical industry. Chemical plants have a lot of pipes. The cost of the materials for producing a pipe is related to the circumference of the pipe and its length. However, the volume of chemicals that can flow through a pipe is determined by the cross-section area of the pipe.

Learn more about economies of scale here :

brainly.com/question/15605103

#SPJ4

You might be interested in
During 2020, Sam and Libby, a married couple, decided to sell their residence, which had a basis of $200,000. They had owned and
baherus [9]

Answer:

$50,000:$400,000

Explanation:

Based on the information given we were told that the Broker's commissions and other selling expenses was the amount of $50,000 in which They as well made purchased of a new residence in July for the amount of $400,000 which means that the recognized gain will be $50,000 the amount of Broker's commissions and other selling expenses and the adjusted basis of the new residence will be $400,000 which is the cost of purchasing a new residence.

6 0
2 years ago
The direct write-off method: multiple choice follows the expense recognition (matching) principle. Is not permitted under GAAP.
Lera25 [3.4K]

Answer: is permitted if results are similar to the allowance method

Explanation:

The direct write-off method is refered to as an accounting method whereby the uncollectible accounts receivable are being written off as bad debt. Here, the bad debts expense account will be debited while the accounts receivable will be credited.

The direct write-off method is permitted if results are similar to the allowance method. For the allowance method, it should be noted that an estimation of the bad debt future amount will be charged to the reserve account once the sale takes place.

4 0
2 years ago
Consider the following transactions for Huskies Insurance Company:
PilotLPTM [1.2K]

Answer:

31-Dec

Dr Depreciation expense $7,000

Cr Accumulated Depreciation - Equipment $7,000

31-Dec

Dr Interest receivable $1,750

Cr Interest revenue $1,750

31-Dec

Dr Deferred Revenue $4,000

Cr Revenue or Service Revenue $4,000

Explanation:

Preparation of the necessary adjusting entry for Huskies Insurance at its year-end of December 31.

31-Dec

Dr Depreciation expense $7,000

Cr Accumulated Depreciation - Equipment $7,000

(Being to adjust 12 month depreciation)

31-Dec

Dr Interest receivable ($50,000 x 7% x 6/12) $1,750

Cr Interest revenue $1,750

(Being to adjust 6 month interest revenue accrued)

31-Dec

Dr Deferred Revenue ($16,000 x 3/12) $4,000

Cr Revenue or Service Revenue $4,000

(Being to record earned revenue for 3 months)

6 0
2 years ago
What is the law of demand and supply<br><br><br>​
Svetradugi [14.3K]

Answer:The law of supply and demand is a theory that explains the interaction between the sellers of a resource and the buyers for that resource. The theory defines what effect the relationship between the availability of a particular product and the desire (or demand) for that product has on its price.

Explanation:

8 0
3 years ago
What role do pawnshops playy in American economy
RUDIKE [14]
Getting rid of old stuff to people who want it instead of throwing it away.
4 0
3 years ago
Other questions:
  • The firm projected its proforma of financial statements using AFN method and finds that next year its AFN is $2 million. Its tot
    7·1 answer
  • ___________ is a process used to test consumer reactions about a product among potential users.
    11·2 answers
  • What is the difference between finance and accounts​
    10·1 answer
  • A _____ is the return on an asset that results when its market price rises above the price an investor paid for it.
    8·2 answers
  • Select two ways of becoming a business owner. compare the advantages and disadvantages and decide which of the two you would pre
    5·2 answers
  • Commercial paper is issued with maturities that do not exceed 270 days because: A. Companies do not want to pay high interest ra
    13·2 answers
  • Jennifer is trying to decide between a cup of coffee and a glass of orange juice. The coffee costs $1 and yields 10 units of add
    14·1 answer
  • Owner's withdrawals:______.
    7·1 answer
  • Suppose that at the beginning of 2019 Jamaal's basis in his S corporation stock is $0, he has a $0 debt basis associated with a
    13·1 answer
  • According to the menu cost theory, firms will be slow in changing their prices because:
    10·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!