The long-run relationship between the quantity of output and the average total cost is:

Question

Quizplus · Accepted Answer

The long-run relationship between the quantity of output and the average total cost is represented by the concept of returns to scale. This refers to the rate at which output increases in response to a proportional increase in all inputs. It determines whether increasing all inputs will result in proportionately more or less output, and thus whether average total costs will increase or decrease as output expands in the long run. Therefore, option C is the correct choice. Options A, B, and D are not relevant to this relationship.

The Long-Run Relationship Between the Quantity of Output and the Average