Economies and diseconomies of scale are associated with the:
A)long-run average total cost curve and the long run.
B)short-run average total cost curve and the short run.
C)marginal cost curve and both the long and short run.
D)average fixed cost curve and the short run.

Question

Quizplus · Accepted Answer

Economies and diseconomies of scale refer to the long-run average total cost curve and the long run. As a firm increases its scale of production, it experiences economies of scale up to a certain point, where it reaches the minimum efficient scale. Beyond that, it experiences diseconomies of scale. These effects are reflected in the long-run average total cost curve.

Economies and Diseconomies of Scale Are Associated with The