ECON3

The Theory of ProductionLong Run Production

Answer all the questions below

1. Explain the following termsa. Increasing Returns to Scaleb. Decreasing Returns to Scalec. Constant Returns to Scale

2. Show a fall long run cost curve or LRATC curve3. Outline the possible shapes which a LRATC curve may take4. Explain the concept of the Minimum Efficient Scale5. Explain the relationship between Short Run and Long Run

Costs

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