If a firm decreases its plant size and finds that its long-run average costs have decreased, then
A) the firm should reduce its plant size even more. B) its labor is more productive in a smaller plant.
C) its diseconomies of scale are less. D) the firm is now profitable.
Question 2
For a firm that can effectively price discriminate, who will be charged a lower price?
A) buyers that are members of the smallest market segment
B) customers who have an elastic demand for the product
C) buyers that are members of the largest market segment
D) customers who have an inelastic demand for the product