In the long-run average total cost curve below,the:

Question

Quizplus · Accepted Answer

The movement from point B to point C reflects diseconomies of scale, as the average total cost increases with the increase in output. Points A and B both show economies of scale, as the average total cost decreases with an increase in output. The realization of economies of scale would shift the entire curve downward, not just particular sections. The law of diminishing returns does not apply to the long-run average total cost curve.

In the Long-Run Average Total Cost Curve Below,the