The table below shows the long-run total cost of three different firms. Output Firm 1 Firm 2 Firm 3 1 $8 $5 $7 2 14 12 12 3 18 21 15 4 20 32 24 Which firm(s) experience economies of scale for all 4 units of output? What is Firm #3’s minimum efficient scale?

The table below shows the long-run total cost of three different firms. Output Firm 1 Firm 2 Firm 3 1 $8 $5 $7 2 14 12 12 3 18 21 15 4 20 32 24 Which firm(s) experience economies of scale for all 4 units of output? What is Firm #3’s minimum efficient scale?

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Question

The table below shows the long-run total cost of three different firms.

Output	Firm 1	Firm 2	Firm 3
1	$8	$5	$7
2	14	12	12
3	18	21	15
4	20	32	24

Which firm(s) experience economies of scale for all 4 units of output?
What is Firm #3’s minimum efficient scale?

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