Effective advertising may decrease a firm's average total costs if:

Name: Effective advertising may decrease a firm's average total costs if:
Brand: Quizplus
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Question

Quizplus · Accepted Answer

Effective advertising can lead to increased demand for a firm's products, which can in turn lead to higher production levels. As production levels increase, the firm may achieve economies of scale, where the average cost of producing each unit decreases as the quantity produced increases. This can lead to a decrease in the firm's average total costs.

Effective Advertising May Decrease a Firm's Average Total Costs If