Which of the following statements is correct if the appropriately sized firm is one with a large output?
A)Constant returns to scale must begin at low levels of output.
B)Economies of scale must prevail until high levels of output are reached.
C)Diseconomies of scale must begin at low levels of output.
D)Constant returns to scale must be absent.

Question

Quizplus · Accepted Answer

Economies of scale typically prevail until a certain level of output is reached, after which diseconomies of scale may begin to occur. Therefore, if the appropriately sized firm is one with a large output, it is likely experiencing economies of scale.

Which of the Following Statements Is Correct If the Appropriately