6.Determine whether the scenarios below lead to economies, diseconomies of scale or neither:A. NeitherB. Diseconomies of ScaleC. Economies of Scale1. Greater use of specialization and division of labor2. Added bureaucracy3. Higher demand for the product The table below gives the long run cost data for producing computers. Find the long run average total cost of producing each unit, then determine if there are Economies of Scale, Constant Returns to Scale or Diseconomies of Scale at selectquantities.Which describes our situation when quantity increases from 2 to 3?OEconomies of ScaleODiseconomies of ScaleOConstant Returns to ScaleWhat about when quantity increases from 3 to 4?OEconomies of ScaleODiseconomies of ScaleOConstant Returns to ScaleQuantity Long run Total Cost in $ Long run Avg Total Cost in $081234528476796< Previous138

Quantity Long run T.C $ L.R A.T.C $ 0 8 -- 1 28 28 2 47 23.5 3 67 22.33 4 96 24 5 138…

Which describes our situation when quantity increases from 2 to 3 Economies of Scale ODiseconomies of Scale Constant Returns to Scale What about when quantity increases from 3 to 4? Economies of Scale ODiseconomies of Scale OConstant Returns to Scale

Which describes our situation when quantity increases from 2 to 3 Economies of Scale ODiseconomies of Scale Constant Returns to Scale What about when quantity increases from 3 to 4? Economies of Scale ODiseconomies of Scale OConstant Returns to Scale

ENGR.ECONOMIC ANALYSIS

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ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Question

6.
Determine whether the scenarios below lead to economies, diseconomies of scale or neither:
A. Neither
B. Diseconomies of Scale
C. Economies of Scale
1. Greater use of specialization and division of labor
2. Added bureaucracy
3. Higher demand for the product

The table below gives the long run cost data for producing computers. Find the long run average total cost of producing each unit, then determine if there are Economies of Scale, Constant Returns to Scale or Diseconomies of Scale at select
quantities.
Which describes our situation when quantity increases from 2 to 3?
OEconomies of Scale
ODiseconomies of Scale
OConstant Returns to Scale
What about when quantity increases from 3 to 4?
OEconomies of Scale
ODiseconomies of Scale
OConstant Returns to Scale
Quantity Long run Total Cost in $ Long run Avg Total Cost in $
0
8
1
2
3
4
5
28
47
67
96
< Previous
138

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