Diseconomies of scale refer to the range of output over which
A)long-run average cost rises as output increases.
B)average cost exceeds marginal cost.
C)long-run average cost falls as output increases.
D)the marginal product of labour increases.
E)marginal product equals average product.

Question

Quizplus · Accepted Answer

Diseconomies of scale occur when a firm's long-run average cost increases as output increases, indicating that the firm is becoming less efficient in production. This can be due to various factors such as increased management costs, communication problems, or resource constraints. As output increases beyond a certain point, the firm may find it difficult to coordinate operations, leading to higher costs per unit of output.

Diseconomies of Scale Refer to the Range of Output Over