Suppose a firm's learning curve is based on

Upper L equals Upper A plus BN Superscript negative betaL=A+BN,

where N is the cumulative units of output produced, L is the labor input per unit of output, and A, B, and

beta

are parameters (constants). What must be true for the firm to experience learning over time such that the long-run average cost of production decreases as cumulative output increases?Part 2For the firm to experience learning over time,Part 3

A.

A must be positive, B must be positive, and

beta

must equal zero.

B.

A, B, and

beta

must be positive.

C.

A must be positive, B must be

positivepositive,

and

beta

must be

negativenegative.

D.

N must be negative.

E.

N must equal one.

Part 4Assuming A and B are positive and

beta

is between 0 and 1, then after all learning has taken place, the amount of labor input required to produce another unit of output is roughly equal toPart 5

A.

N.

B.

1.

C.

0.

D.

B.

E.

A.