Figure 13-9
The figure below depicts average total cost functions for a firm that produces automobiles.
-Refer to Figure 13-9. This firm experiences diseconomies of scale at what output levels?
A)output levels greater than N
B)output levels between M and N
C)output levels less than M
D)All of the above are correct as long as the firm is operating in the long run.

Question

Figure 13-9
The figure below depicts average total cost functions for a firm that produces automobiles. 
-Refer to Figure 13-9. This firm experiences diseconomies of scale at what output levels?
A)output levels greater than N 
B)output levels between M and N 
C)output levels less than M 
D)All of the above are correct as long as the firm is operating in the long run.

Quizplus · Accepted Answer

Diseconomies of scale occur when a firm's average costs increase as output increases. In the context of the figure, this typically happens at output levels greater than N, where the firm is producing beyond its efficient scale.

Figure 13-9 the Figure Below Depicts Average Total Cost Functions for a for a Firm