-The average total cost curves for plants A, B, C, and D are shown in the above figure. It is possible that the long-run average cost curve runs through points
A) a, b, and c.
B) b, d, and e.
C) d, e, and f.
D) c and d.

Question

-The average total cost curves for plants A, B, C, and D are shown in the above figure. It is possible that the long-run average cost curve runs through points
A) a, b, and c. 
B) b, d, and e. 
C) d, e, and f. 
D) c and d.

Quizplus · Accepted Answer

The long-run average cost curve is an envelope of the short-run average cost curves, touching them at their lowest points. Points d, e, and f are likely the lowest points of the average total cost curves for plants B, C, and D, respectively.

-The Average Total Cost Curves for Plants A, B, C