A long-run ATC curve shows:

Question

Quizplus · Accepted Answer

A long-run ATC curve shows the minimum average total cost possible for every possible size firm across an industry. This allows firms to see what size they need to be in order to capture the lowest costs per unit, which is an advantage in the industry. Additionally, the long-run ATC curve shows which size firms can capture economies of scale by expanding, which can lead to lower costs and greater efficiency in production. Therefore, all of the options are true.

A Long-Run ATC Curve Shows