Question

A movie theater with four screens has lower average costs than a theatre with only one screen. A theatre with 18 screens has even lower costs than a theatre with 4. Movie theaters experience ___________ when expanding to 18 screens.

a. diminishing marginal returns
b. declining profit
c. diseconomies of scale
d. economies of scale
e. higher prices

Answer 1

b?

Answer 2

I'm thinking it has to do with economies of scale because as screens increase, average costs decrease. so either c or d

of the two I'd probably think it's D because AC decreases as screens increase, so it's an economy of scale.

Answer 3

Oooh okay, thank you!!!!! <3

Answer 4

you got this!!!! <3