Which curve is called the planning curve of a firm?

LAC

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SAC

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TFC

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Solution

The correct option is A LAC
The LAC curve is the locus of all the points denoting the least cost for producing that level of output. It is a planing curve because on the basis of this the producer decides what the size of the plant should be in order to produce optimally. This optimal point is the minimum point of the long run average cost curve.

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