Diseconomies of scale definitely mean that as the firm increases its output, its
A) long- run average total cost increases.
B) short- run average total cost increases.
C) long- run average total cost decreases.
D) short- run average total cost decreases.

Question

Quizplus · Accepted Answer

Diseconomies of scale occur when a firm's long-run average total costs increase as it increases its output. This is typically due to inefficiencies that arise from becoming too large, such as difficulties in management or coordination.

Diseconomies of Scale Definitely Mean That as the Firm Increases