How Are a Firm's Short-Run and Long-Run Average Cost Curves

question 58

Multiple Choice

How are a firm's short-run and long-run average cost curves related?

• A) SRAC is greater than LRAC,which forces the LRAC curve to be upward sloping.
• B) SRAC and LRAC slope up or down together,but SRAC is always the steeper of the two curves.
• C) The SRAC curve is tangent to and lies above the LRAC curve.
• D) The LRAC curve just touches the SRAC curve at its minimum point.

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