A firm's long-run average total costs increase as it produces more output.This firm has:

A) economies of scale.
B) constant returns to scale.
C) diseconomies of scale.
D) a spreading effect.

The following price quotations were taken from the Wall Street Journal. $\begin{array}{rrr}\text{ Stock Price}& \text{ Strike }& \text{ February }\\ & \text{ Price }& \\ 917/8& 85& 73/8\\ 917/8& 90& 31/8\\ 917/8& 95& 5/8\end{array}$ The premium on one February 90 call contract is

A) $3.1250.
B) $318.00.
C) $312.50.
D) $58.00.

The effective interest amortization method:

A) Allocates bond interest expense over the bond's life using a changing interest rate.
B) Allocates bond interest expense over the bond's life using a constant interest rate.
C) Allocates a decreasing amount of interest over the life of a discounted bond.
D) Allocates bond interest expense using the current market rate for each interest period.
E) Is not allowed by the FASB.