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lectur21-page4 - curves associated with a series of...

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LONG RUN AVERAGE COST CURVE 1. In the long run all costs are variable. Therefore, this curve is actually a long run average variable cost curve, but since we know all costs are variable in the long run, we just call it the LAC. 2. The LAC is constructed form a series of short run average total cost
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Unformatted text preview: curves associated with a series of different output levels (Q). 3. The LAC is the points which are tangent to the minimums of the short run average total cost (SAC) curves associated with each output level....
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