The minimum efficient scale is
A) the level of output where diminishing returns have not set in yet.
B) the plant size that yields the most profit.
C) level of operation where long-run average costs are lowest.
D) the smallest output level where the firm finally reaches productive efficiency.

Question

Quizplus · Accepted Answer

The minimum efficient scale is the level of operation where long-run average costs are lowest. This is the point at which the firm can produce at the lowest cost per unit and is therefore the most efficient in its production process. This level of output is also known as the optimal plant size.

The Minimum Efficient Scale Is