The Table Below Comes from Cost Data from the Long

question 39

Essay

The table below comes from cost data from the long run total cost function. It shows the monthly output and total monthly cost of USB drives for three firms in the industry. Given the information in the table, can we draw any conclusions about the returns to scale in the USB drive industry? If so, what does the information suggest about the shape of the long-run average cost curve?

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Definitions:

TIG Welded

A type of welding that uses a tungsten electrode to produce the weld, known for its strong and high-quality welds, especially on thin materials.

Vortex Flow

Eddy force created by rotational movement. Both a whirlpool and a tornado produce vortex flow, as do the dynamics of a torque converter. See vortex oil flow.

Torque Multiplied

The increase in torque generated through the use of a mechanical system like a gearbox, allowing for greater force to be applied without increasing input power.

Flex Plate

A component in automatic transmission vehicles that connects the engine to the torque converter, allowing for flexion and torque transfer.