When MC (the purple line) is greater than Q1CONCEPTShut-down Point7Which of the following is true regarding how a market type interactswith constant, increasing and decreasing cost industries?
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In a monopoly, firms are likely to begin experiencing diseconomies of scaleat relatively low levels of output.In a perfectly competitive market, firms will usually experience significanteconomies of scale until very high levels of output.In a perfectly competitive market, firms tend to experience diseconomies ofscale at relatively low levels of output.CONCEPTConstant, Increasing and Decreasing Cost Industries8A variable input is one that __________.will change as a result of changes in productionwill always have increasing costsis highly expensive to change in the long runwill not change over the scope of productionCONCEPTProduction Function and Constraints9
