A firm experiences ________ when its ________ downward as output ...

[crazycityslicker]

A firm experiences ________ when its ________ downward as output increases.
 
  A) diseconomies of scale; average total cost curve slopes
  B) economies of scale; long-run average cost curve slopes
  C) diminishing marginal returns; long-run average cost curve slopes
  D) diminishing marginal returns; average total cost curve shifts

Question 2

Kristen has an income of 450 per year to spend on music CDs and movies on DVDs. The price of a CD is 15 and the initial price of a DVD is 22.50. The indifference curves in the figure above (I1, I2, and I3 ) reflect Kristen's preferences.
 
  If the price of a DVD falls to 18, the income effect on Kristen's consumption of DVDs ________ the substitution effect, so a DVD is ________ good. A) partly offsets; an inferior
  B) partly offsets; a normal
  C) reinforces; an inferior
  D) reinforces; a normal

[Sophiapenny]

Answer to Question 1

B

Answer to Question 2

D

[crazycityslicker]

Excellent

[carojassy25]

Great answer, keep it coming