For Many Firms the LRAC Curve Is U- Shaped

question 38

Multiple Choice

For many firms the LRAC curve is U- shaped.The downward- sloping portion of the LRAC curve can be explained by

• A)economies of scale.
• B)the spreading of overhead.
• C)both (a)and (b).
• D)declining prices of the fixed factor
• E)decreasing short- run marginal cost.

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