Narrbegin Exhibit 6.9 Cost curves
-In Exhibit 6.9, a firm finds that it is experiencing numerous managerial and information problems. The position of its short-run and long-run average total cost curves suggest that it is operating at a production level:

Question

Narrbegin Exhibit 6.9 Cost curves  
-In Exhibit 6.9, a firm finds that it is experiencing numerous managerial and information problems. The position of its short-run and long-run average total cost curves suggest that it is operating at a production level:

Quizplus · Accepted Answer

The firm is experiencing managerial and information problems, which are typically associated with diseconomies of scale. This suggests that the firm is operating beyond its efficient scale, likely at a higher production level such as between 3000 and 4000, where long-run average total costs are increasing.

Narrbegin Exhibit 6.9 Cost Curves