Explain How One Gains Customer Loyalty

question 68

Essay

Explain how one gains customer loyalty.

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Definitions:

Long-Run Average Cost Curve

A curve that shows the lowest average cost at which a firm can produce any given level of output in the long run, when all inputs are variable.

Short-Run

A period during which at least one input (for example, plant size, machinery) in the production process is fixed and cannot be changed.

Tangent

A straight line that touches a curve at a single point without crossing it, often used in geometry and calculus to represent the slope of the curve at that point.

Diseconomies of Scale

An economic concept referring to a situation where, as a firm expands, the costs per unit increase.