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What happens to long-run average cost when a firm exploits economies of scale?

A

Long-run average cost falls as the firm's scale of output increases.

B

Long-run average cost becomes zero as the firm's scale of output increases.

C

Long-run average cost remains constant as the firm's scale of output increases.

D

Long-run average cost rises as the firm's scale of output increases.

Card 1 of 20

7.7.1 reasons for different sizes of firms Flashcards

  1. Intl A Level
  2. /Economics
  3. /7.7.1 reasons for different sizes of firms

20 flashcards on CIE Intl A Level Economics 7.7.1 reasons for different sizes of firms: the key terms and definitions you need to recall.

Flashcards