ECON 528 ULL FINAL
EXAM PREPARATION
QUESTIONS AND
CORRECT ANSWERS
GRADED A+ 2025-2026
Which of the following is a reason why a firm would experience diseconomies of scale?
Select one:
a. As the size of the firm increases, it becomes more difficult to find markets where it
doesn't already have operations.
b. To finance an increase in the size of its plant a firm must borrow more money or
sell more shares of stock.
c. As the size of the firm increases, it must operate in other countries where
differences in language, customs and laws increase its average costs.
d. As the size of the firm increases it becomes more difficult to coordinate the
operations of its manufacturing plants. - ANS-d. As the size of the firm increases it
becomes more difficult to coordinate the operations of its manufacturing plants.
The minimum efficient scale is
Select one:
a. the plant size that yields the most profit.
b. level of operation where long-run average costs are lowest.
c. the level of output where diminishing returns have not set in yet.
d. the smallest output level where the firm finally reaches productive efficiency. - ANS-
b. level of operation where long-run average costs are lowest.
scale?
EXAM PREPARATION
QUESTIONS AND
CORRECT ANSWERS
GRADED A+ 2025-2026
Which of the following is a reason why a firm would experience diseconomies of scale?
Select one:
a. As the size of the firm increases, it becomes more difficult to find markets where it
doesn't already have operations.
b. To finance an increase in the size of its plant a firm must borrow more money or
sell more shares of stock.
c. As the size of the firm increases, it must operate in other countries where
differences in language, customs and laws increase its average costs.
d. As the size of the firm increases it becomes more difficult to coordinate the
operations of its manufacturing plants. - ANS-d. As the size of the firm increases it
becomes more difficult to coordinate the operations of its manufacturing plants.
The minimum efficient scale is
Select one:
a. the plant size that yields the most profit.
b. level of operation where long-run average costs are lowest.
c. the level of output where diminishing returns have not set in yet.
d. the smallest output level where the firm finally reaches productive efficiency. - ANS-
b. level of operation where long-run average costs are lowest.
scale?
