If constant returns to scale apply to the entire range of production,then the long-run total cost curve would most likely:
A)be a straight line from the origin.
B)to increase at a decreasing rate initially,and then increase at an increasing rate.
C)to increase at an increasing rate initially,and then increase at a decreasing rate.
D)be U-shaped.

Question

Quizplus · Accepted Answer

If constant returns to scale apply to the entire range of production, the long-run total cost curve would be a straight line from the origin. This is because, at each point on the line, the cost per unit of output remains constant. Hence, the curve will not slope upward or downward as output increases.

If Constant Returns to Scale Apply to the Entire Range