What is the minimum efficient scale (MES)of production?
A)The point on an average cost curve where the cost per unit begins to decline more rapidly
B)The minimum point on a U-shaped average cost curve
C)The minimum level of production at a plant for it to be considered profitable
D)The level of production for a small sized plant
E)The threshold at which capacity is constraining for a firm's production

Question

Quizplus · Accepted Answer

The minimum efficient scale (MES) of production refers to the lowest point on the long-run average cost curve where the firm can produce its goods or services at a minimum average cost. This is typically represented by the minimum point on a U-shaped average cost curve, indicating the most efficient scale of operation for the firm.

What Is the Minimum Efficient Scale (MES)of Production