Practice Long run

Related Topics

Wize University Microeconomics Textbook > Production and Costs

Long Run Costs

2 Activities

The diagram below shows the LRAC for a firm. The SRATC curves 1-5 refer to different plant sizes. 

In the long run, the lowest cost level of output achievable by this firm is at point

More Long Run Costs Questions:

Economies of scale occurs when

A) A firm experiences economies of scale if its average total cost decreases
 
(increases/decreases/remains constant as its output increases)
B) A firm experiences diseconomies of scale if its average total cost increases
 