When a firm experiences economies of scale, its ________ cost curve slopes ________ as output increases.
A) long-run average; downward
B) short-run average total; downward
C) short-run marginal cost; downward
D) long-run average; upward

Question

Quizplus · Accepted Answer

Economies of scale occur when increasing production leads to lower average costs, causing the long-run average cost curve to slope downward as output increases.

When a Firm Experiences Economies of Scale, Its ________ Cost