Economies of scale imply that within some range a firm can increase the size of operation and
A) total cost will decrease.
B) fixed cost will decrease.
C) average total cost will decrease.
D) average total cost will increase.
E) average variable cost will decrease.

Question

Quizplus · Accepted Answer

Economies of scale occur when increasing production leads to a lower average total cost per unit, as fixed costs are spread over a larger number of units.

Economies of Scale Imply That Within Some Range a Firm