The long-run average cost curve shows the lowest possible average cost for each output level, given that all inputs are variable.

Name: The long-run average cost curve shows the lowest possible average cost for each output level, given that all inputs are variable.
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Quizplus · Accepted Answer

This is because in the long run, the firm has the flexibility to adjust all inputs and can choose the most cost-efficient combination of inputs to produce any given output level, resulting in the lowest possible average cost.

The Long-Run Average Cost Curve Shows the Lowest Possible Average