Question

Economies and diseconomies of scale explain why the:

• A. short-run average fixed cost curve declines so long as output increases
• B. marginal cost curve must intersect the minimum point of the firm's average total cost curve
• C. long-run average total cost curve is typically U-shaped
• D. short-run average variable cost curve is U-shaped

Answer 1

The correct option is C

long-run average total cost curve is typically U-shaped

Economies and diseconomies of scale explain why the long-run average total cost curve is typically U-shaped.