1.) In the long run, if the firm decides to keep output at its initial level, what will it likely do? Stay on SRATC5 Shift to operate on SRATC3 Shift to operate on SRATC1 Shut down 2.) Over which range of output levels do you find diseconomies of scale? Q2 to Q4 0 to Q3 Greater than Q30 to Q5 0 to Q1 COST PER UNIT SRATC₁ SRATC 5 SRATC LRAC SRATC2 SRATC Q1 Q2 QUANTITY OF OUTPUT In the long run, if the firm decides to keep output at its initial level, what will it likely do? Stay on SRATC5 Shift to operate on SRATC3 COST PER UNIT SRATC SRATC SRATC LRAC SRATC₂ SRATC3 4 Q1 Q2 Q3 QUANTITY OF OUTPUT Q4 Q5 In the long run, if the firm decides to keep output at its initial level, what will it likely do? ○ Stay on SRATCs Shift to operate on SRATC3

ENGR.ECONOMIC ANALYSIS
14th Edition
ISBN:9780190931919
Author:NEWNAN
Publisher:NEWNAN
Chapter1: Making Economics Decisions
Section: Chapter Questions
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1.) In the long run, if the firm decides to keep output at its initial level, what will it likely do? Stay on SRATC5 Shift to
operate on SRATC3 Shift to operate on SRATC1 Shut down 2.) Over which range of output levels do you find
diseconomies of scale? Q2 to Q4 0 to Q3 Greater than Q30 to Q5 0 to Q1
COST PER UNIT
SRATC₁
SRATC 5
SRATC
LRAC
SRATC2
SRATC
Q1 Q2
QUANTITY OF OUTPUT
In the long run, if the firm decides to keep output at its initial level, what will it likely do?
Stay on SRATC5
Shift to operate on SRATC3
Transcribed Image Text:1.) In the long run, if the firm decides to keep output at its initial level, what will it likely do? Stay on SRATC5 Shift to operate on SRATC3 Shift to operate on SRATC1 Shut down 2.) Over which range of output levels do you find diseconomies of scale? Q2 to Q4 0 to Q3 Greater than Q30 to Q5 0 to Q1 COST PER UNIT SRATC₁ SRATC 5 SRATC LRAC SRATC2 SRATC Q1 Q2 QUANTITY OF OUTPUT In the long run, if the firm decides to keep output at its initial level, what will it likely do? Stay on SRATC5 Shift to operate on SRATC3
COST PER UNIT
SRATC
SRATC
SRATC
LRAC
SRATC₂
SRATC3
4
Q1 Q2
Q3
QUANTITY OF OUTPUT
Q4
Q5
In the long run, if the firm decides to keep output at its initial level, what will it likely do?
○ Stay on SRATCs
Shift to operate on SRATC3
Transcribed Image Text:COST PER UNIT SRATC SRATC SRATC LRAC SRATC₂ SRATC3 4 Q1 Q2 Q3 QUANTITY OF OUTPUT Q4 Q5 In the long run, if the firm decides to keep output at its initial level, what will it likely do? ○ Stay on SRATCs Shift to operate on SRATC3
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