Suppose a particular firm exhibits constant returns to scale as it increases its output overany reasonable range. If it increases its total costs by 10%, then its:O long run average cost curve will shift to the right by 10%O average total cost will increase by 10%%.O total cost will increase by less than 10%.O output will increase by 10%.21tvMacBook Pro80O00 FAFSF6F7F819

Returns to scale refers to proportional change in total cost in response to proportional change in…

Suppose a particular firm exhibits constant returns to scale as it increases its output over any reasonable range. If it increases its total costs by 10%, then its: long run average cost curve will shift to the right by 10% O average total cost will increase by 10%. O total cost will increase by less than 10%. O output will increase by 10%.

Suppose a particular firm exhibits constant returns to scale as it increases its output over any reasonable range. If it increases its total costs by 10%, then its: long run average cost curve will shift to the right by 10% O average total cost will increase by 10%. O total cost will increase by less than 10%. O output will increase by 10%.

Essentials of Economics (MindTap Course List)

8th Edition

ISBN:9781337091992

Author:N. Gregory Mankiw

Publisher:N. Gregory Mankiw

Chapter12: The Cost Of Production

Section: Chapter Questions

Problem 4CQQ

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