Magma Motor Company is producing at minimum efficient scale when it produces 2,000 cars per month. What happens if it increases output to 2,100 per month?

Question

Quizplus · Accepted Answer

When a company is producing at its minimum efficient scale, increasing output typically leads to higher average total costs in the long run, as it moves beyond the most efficient point of production.

Magma Motor Company Is Producing at Minimum Efficient Scale When