The figure below shows a family of cost curves for a firm.The subscripts 1,2,and 3 for the SRATC curves refer to different plant sizes.
FIGURE 8- 3
-Refer to Figure 8- 3.Each of the three SRATC curves shows
A)the lowest cost attainable,holding the plant size constant.
B)optimal plant sizes in the long run.
C)the lowest cost attainable,given that the plant size is the largest it can possibly be.
D)technically inefficient methods of production,given that they lie above the LRAC.
E)the output that is possible when all factors of production are fixed.

Question

The figure below shows a family of cost curves for a firm.The subscripts 1,2,and 3 for the SRATC curves refer to different plant sizes.
  FIGURE 8- 3
-Refer to Figure 8- 3.Each of the three SRATC curves shows
A)the lowest cost attainable,holding the plant size constant. 
B)optimal plant sizes in the long run. 
C)the lowest cost attainable,given that the plant size is the largest it can possibly be. 
D)technically inefficient methods of production,given that they lie above the LRAC. 
E)the output that is possible when all factors of production are fixed.

Quizplus · Accepted Answer

Each SRATC (Short-Run Average Total Cost) curve represents the lowest cost attainable for a given plant size, holding that plant size constant in the short run.

The Figure Below Shows a Family of Cost Curves for a Firm.The