The long-run average cost (LRAC) curve indicates the ________.
A) per unit cost of output in the long run
B) projected total production costs of competitors
C) variable costs incurred by a firm over time
D) fixed costs incurred by a firm over the long term
E) number of units the market will buy in a given time period, at different prices that might be charged

Question

Quizplus · Accepted Answer

The long-run average cost (LRAC) curve is a graphical representation of the per unit cost of output in the long run as a firm adjusts its production levels and inputs to minimize production costs. Therefore, choice A is the correct answer. Choices B, C, D, and E are not correct as they do not accurately describe the LRAC curve.

The Long-Run Average Cost (LRAC) Curve Indicates the ________