Which of the following is a condition for industry expansion through expansion of existing firms instead of entry of new firms?
A)Firms take advantage of diseconomies of scale.
B)A firm size is greater than the minimum efficient sale.
C)A firm's average total cost decreases as a result of technological change.
D)A firm produces beyond the minimum long-run average total cost.
E)Firms make normal profits.

Question

Quizplus · Accepted Answer

A firm's average total cost decreases as a result of technological change, allowing for industry expansion through the expansion of existing firms. This is because technological advancements can improve efficiency and reduce costs, making it more advantageous for existing firms to expand their operations rather than new firms entering the market.

Which of the Following Is a Condition for Industry Expansion