If long run average costs fall with output,you have
A)Increasing returns to scale
B)Decreasing returns to scale
C)Constant returns to scale
D)None of the above

Question

​If long run average costs fall with output,you have
A)​Increasing returns to scale
B)Decreasing returns to scale
C)Constant returns to scale
D)​None of the above

Quizplus · Accepted Answer

When long run average costs fall with output, it indicates that the firm is experiencing increasing returns to scale. This means that as output increases, the firm is able to enjoy a higher level of efficiency and productivity, leading to lower average costs. This could be due to factors such as specialization, division of labor, and economies of scale.

​If Long Run Average Costs Fall with Output,you Have

If Long Run Average Costs Fall with Output,you Have