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Long Run Average Cost (or LAC)
-Constant Returns to Scale
-Increasing Returns to Scale
-Decreasing Returns to the Scale
-In the long run:
-Long run marginal cost(LMC) leads long run average cost(LAC):
Question
-What is relationship between long run average cost and long run marginal cost when long run average cost is constant?
demand: Qd=100=Px supply: MC=10+1/2Qs assume first that this firm operates in a perfectly competitive market. find the price and quanity in this market.
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