When input prices are fixed,decreasing returns to scale implies that the long-run average cost curve is
A) downward sloping.
B) horizontal.
C) upward sloping.
D) U-shaped.

Question

Quizplus · Accepted Answer

Decreasing returns to scale imply that as the quantity of output produced increases, the average cost per unit of output will increase. This means that the long-run average cost curve will slope upward.

When Input Prices Are Fixed,decreasing Returns to Scale Implies That