Subject:
Advanced Placement (AP)Author:
sparklemurilloCreated:
1 year agoIn the scenario above, it can be explained by the long-run average cost curve being U-shaped.
What leads to economies of scale?
Economies of scale is known to be a kind of cost benefit gotten by companies if production is said to be very efficient.
Note that the long run average cost curve is seen in a U shape to show that the average cost at first decreases as a result of economies of scale and as such, the firm had increasing returns to scale and this is shown by consistent returns as the firm works or functions at its optimal size.
Author:
reymxia
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