Increases in long-run average cost that result from output increases is
A) the law of diminishing marginal product.
B) economies of scale.
C) constant returns to scale.
D) diseconomies of scale.

Question

Quizplus · Accepted Answer

Diseconomies of scale occur when the firm has difficulty managing and coordinating its resources as it expands production, leading to increases in long-run average cost.

Increases in Long-Run Average Cost That Result from Output Increases