What denotes the output level where economies of scale are exhausted and constant returns to scale begin?

Question

Quizplus · Accepted Answer

Minimum efficient scale (MES) is the output level where economies of scale are exhausted and constant returns to scale begin. This is the point where the firm is producing at the lowest possible average cost. After reaching MES, any increase in output will result in constant returns to scale or even diseconomies of scale. Therefore, option A is the correct answer.

What Denotes the Output Level Where Economies of Scale Are