12 Economic Costs (1)

Inputs diseconomies of scale output increases by a

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Unformatted text preview: its inputs by. inputs Constant Returns to Scale: Output increases by Constant the same % that a firm increases its inputs by. 12 12 Average Total Costs Long-Run ATC Curve ATC-1 Constant Returns to Scale where LRATC Curve is flat ATC-5 ATC-2 ATC-3 ATC-4 Long-Run ATC Diseconomies of Scale where LRATC Curve is sloped upward Economies of Scale where LRATC Curve is sloped downward Output The long-run ATC curve just “envelopes” the short run ATCs 13 13...
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