Post Utme Pan Atlantic University 2023 Economics Question 27

Practice objective / multiple choice question 27 from the 2023 Post Utme Pan Atlantic University Economics examination.

Post Utme Pan Atlantic University 2023 Economics Objective / Multiple Choice
Question 27 POST_UTME_PAN-ATLANTIC_UNIVERSITY • 2023 • ECONOMICS • objective

A firm is considering investing in a new project. The project has a fixed \cost of ₦100,000 and a variable \cost of ₦50 per unit produced. The selling price of each unit is ₦75. U\sing the concept of returns to scale, explain why the firm may not invest in the project.

Answer Options

Correct Answer A. The firm's average \cost per unit is increa\sing as output increases.
B. The firm's average \cost per unit is decrea\sing as output increases.
C. The firm's average \cost per unit remains cons\tant as output increases.
D. The firm's average \cost per unit is decrea\sing as output decreases.
Correct Answer
A
Correct Option:
The firm's average \cost per unit is increa\sing as output increases.

About This Question

This is Post Utme Pan Atlantic University 2023 Economics Question 27. It is one of the objective questions from the 2023 Post Utme Pan Atlantic University Economics examination.

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