A firm experiences a shift in its long-run average cost curve from LRAC1 LRAC_1\,LRAC1 to LRAC2 LRAC_2\,LRAC2 as shown in the diagram.
What is the most likely cause of this shift?
An increase in raw material costs due to localized shortages as many new firms enter the industry
The establishment of a specialized local training college feeding skilled graduates into the industry
The introduction of specialized machinery following an expansion in the firm's own scale of production
Communication difficulties that occur as the firm hires more workers and expands its operations