Cost LRAC B A Quantity Figure 1 Long run average cost curve for a firm Figure 1 shows a long run average cost curve for a firm. If the firm increases output from point A to point B this is an example of: Select one: O i. A change in production function O ii. Economies of scale O ii. Constant unit cost O iv. Diseconomies of scale

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Short-Run Costs and Long-Run Costs

Cost of short-run and the long-run is an economic term that describes the cost involved in the production of goods in a firm in the short as well as long period.