Question

2. Explain the shapes of long run cost corves?








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Answer 1

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The long run is different from the short run in the variability of factor inputs. Accordingly, long-run cost curves are different from short-run cost curves. This lesson introduces you to Long run Total, Marginal and Average costs. You will learn the concepts, derivation of cost curves and graphical representation by way of diagrams and solved examples.

Answer 2

Answer:

The long-run cost curves are u shaped for different reasons. It is due to economies of scale and diseconomies of scale. If a firm has high fixed costs, increasing output will lead to lower average costs. However, after a certain output, a firm may experience diseconomies of scale.

Explanation:

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