At the planned output level, short-run average total cost equals long-run average total cost, but at all other points, short-run average total cost is higher than long-run average total cost.

Question

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In the long run, firms can adjust all inputs to achieve the lowest possible cost, while in the short run, some inputs are fixed, leading to higher costs except at the planned output level where both costs are equal.

At the Planned Output Level, Short-Run Average Total Cost Equals