In the graph below six short-run average cost curves labeled a through f are illustrated.

-Refer to the graph above to answer this question.Which set of short-run average cost curves illustrates diseconomies of scale?
A)a and b only
B)a,b and c only.
C)a,b,c,and d
D)d and e only.
E)e and f only.

Question

In the graph below six short-run average cost curves labeled a through f are illustrated.
 
-Refer to the graph above to answer this question.Which set of short-run average cost curves illustrates diseconomies of scale?
A)a and b only 
B)a,b and c only. 
C)a,b,c,and d 
D)d and e only. 
E)e and f only.

Quizplus · Accepted Answer

Diseconomies of scale occur when a company or business grows so large that the costs per unit increase. It happens due to inefficiencies that arise from the difficulty of managing a larger workforce and operations. In the context of short-run average cost curves, diseconomies of scale are illustrated by curves that show an increase in average costs as output increases. Without seeing the actual graph, the correct answer typically identifies the curves where average costs rise with increased production, indicating diseconomies of scale.

In the Graph Below Six Short-Run Average Cost Curves Labeled