21.Iflong-runaveragetotalcostdecreasesasthequantityofoutputincreases,thefirmisexperiencing a.economiesofscale. b.diseconomiesofscale. c.coordinationproblemsarisingfromthelargesizeofthefirm. d.fixedcostsgreatlyexceedingvariablecosts. 22.Inthelongrunacompanythatproducesandsellspopcornincurstotalcostsof$1,050whenoutputis90canistersand$1,200whenoutputis120canisters.Thepopcorncompanyexhibits a.diseconomiesofscalebecausetotalcostisrisingasoutputrises. b.diseconomiesofscalebecauseaveragetotalcostisrisingasoutputrises. c.economiesofscalebecausetotalcostisrisingasoutputrises. d.economiesofscalebecauseaveragetotalcostisfallingasoutputrises. 23.Inthelongrunacompanythatproducesandsellscandybarsincurstotalcostsof$1,200whenoutputis2,400candybarsand$1,400whenoutputis2,900candybars.Thecandybarcompanyexhibits a.diseconomiesofscalebecausetotalcostisrisingasoutputrises. b.diseconomiesofscalebecauseaveragetotalcostisrisingasoutputrises. c.economiesofscalebecausetotalcostisrisingasoutputrises. d.economiesofscalebecauseaveragetotalcostisfallingasoutputrises. 24.Supposethatafirm’slongrunaveragetotalcostsofproducingtelevisionsdecreasesasitproducesbetween10,000and20,000televisions.Forthisrangeofoutput,thefirmisexperiencing a.economiesofscale. b.constantreturnstoscale. c.diseconomiesofscale. d.coordinationproblems. 25.Sincethe1980s,Wal-MartstoreshaveappearedinalmosteverycommunityinAmerica.Wal-Martbuysitsgoodsinlargequantitiesand,therefore,atcheaperprices.Wal-Martalsolocatesitsstoreswherelandpricesarelow,usuallyoutsideofthecommunitybusinessdistrict.ManycustomersshopatWal-Martbecauseoflowprices.Localretailers,liketheneighborhooddrugstore,oftengooutofbusinessbecausetheylosecustomers.Thisstorydemonstratesthat a.consumersdonotreacttochangingprices. b.therearediseconomiesofscaleinretailsales. c.thereareeconomiesofscaleinretailsales. d.therearediminishingreturnstoproducingandsellingretailgoods. 26.Whichofthefollowingstatementsisnotcorrect? a.Inthelongrun,therearenofixedcosts. b.Marginalcostisindependentoffixedcosts. c.Economiesofscaleisashort-runconcept. d.Diminishingmarginalproductexplainsincreasingmarginalcost. 27.Inthelongrunacompanythatproducesandsellslaundrydetergentincurstotalcostsof$2,500whenoutputis1,250unitsand$2,750whenoutputis1,500units.Forthisrangeofoutput,thelaundrydetergentcompanyexhibits a.economiesofscale. b.constantreturnstoscale. c.diseconomiesofscale. d.efficientscale. 28.Atlowlevelsofproduction,thefirm a.benefitsfromincreasedsizebecauseitcantakeadvantageofgreaterspecialization. b.hasthepotentialforeconomiesofscale. c.isunlikelytoexperiencesacuteproblemswithcoordination. d.Alloftheabovearecorrect. 29.TheBigBlueSkyjetcompanyhaslong-runtotalcostsof$20millionifitproduces5jetsandlong-runtotalcostsof$24million ifit produces6 jets.TheBigBlueSkyjetcompanyisexperiencing a.economiesofscale. b.constantreturnstoscale. c.diseconomiesofscale. d.negativeprofits. 30.Whenafirmexperiencesconstantreturnstoscale, a.long-runaveragetotalcostisunchanged,evenwhenoutputincreases. b.long-runmarginalcostisgreaterthanlong-runaveragetotalcost. c.long-runmarginalcostislessthanlong-runaveragetotalcost. d.thefirmislikelytoexperiencecoordinationproblems.