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diana alvarez
on Nov 04, 2024

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Engineers for The All-Terrain Bike Company determine that a 10% increase in all inputs will cause an equal percentage increase in output. Assuming that input prices remain constant, you correctly deduce that such a change in inputs will cause ________ as output increases.

A) average costs to increase
B) average costs to decrease
C) average costs to remain constant
D) marginal costs to increase

Equal Percentage Increase

A situation where all variables increase by the same proportionate rate.

Average Costs

The total cost of production divided by the number of goods produced, representing the cost per unit of output.

  • Evaluate how increases in inputs influence average and marginal costs.
  • Comprehend the relationship between the scale of production and long-run average cost curve shapes.
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RM
Rashad MorleyNov 05, 2024
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