Any firm that has economies of scale will
A)Try to spread production over many plants.
B)Be able to produce at a lower unit cost as it increases production.
C)Face an upward-sloping long-run average total cost curve.
D)Prefer to produce a small amount of total industry output.

Question

Quizplus · Accepted Answer

Economies of scale refer to the decrease in unit cost as a firm increases its production. This is achieved by spreading fixed costs over a larger output and taking advantage of bulk discounts on inputs. Therefore, firms with economies of scale will prefer to increase production in order to lower their unit cost and increase profitability.

Any Firm That Has Economies of Scale Will