In a sense, the long-run average cost curve is holding

Question

Quizplus · Accepted Answer

The long-run average cost curve is a graphical representation of the minimum average total cost for each level of output in the long run, where all inputs are variable. Therefore, it holds short-run average total cost curves, which are the costs associated with producing a given level of output in the short run with at least one input being fixed. The short-run marginal cost curve (option B) is the additional cost of producing an additional unit of output in the short run and is not directly related to the long-run average cost curve. The short-run average variable and total cost curves (options A and D) are also not directly related to the long-run average cost curve as they represent costs in the short run with at least one input being fixed.

In a Sense, the Long-Run Average Cost Curve Is Holding