In the Long Run a Company That Produces and Sells

Multiple Choice

In the long run a company that produces and sells dog beds incurs total costs of $1,200 when output is 30 beds and $1,600 when output is 40 beds. Firm A exhibits

A) diseconomies of scale because total cost is rising as output rises.
B) constant returns to scale because average total cost is constant as output rises.
C) diseconomies of scale because average total cost is rising as output rises.
D) economies of scale because average total cost is falling as output rises.