Exhibit 7-16 Long-run average cost curves
-In Exhibit 7-16, which firm's long-run average cost curve experiences constant returns to scale?

Name: Exhibit 7-16 Long-run average cost curves -In Exhibit 7-16, which firm's long-run average cost curve experiences constant returns to scale?
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Question

Exhibit 7-16 Long-run average cost curves 
-In Exhibit 7-16, which firm's long-run average cost curve experiences constant returns to scale?

Quizplus · Accepted Answer

Firm B's long-run average cost curve is flat, indicating that costs remain constant as output increases, which is characteristic of constant returns to scale.

Exhibit 7-16 Long-Run Average Cost Curves