Title
(7) Economies of Scale I: The Concept
Topic Category
Cost
Publication Date
2011
Keywords
Economies of Scale, Diseconomies of Scale, Constant Returns to Scale, Shape of Long Run Average Cost Curve
Abstract
This explores the concept of Economies of Scale, and how it relates to the shape of the Long Run Average Total Cost Curve (LRAC). It describes the notion of "scale" as a volume of output produced in a time period measure. It establishes the "Economies of Scale" are associated with a declining LRAC, and "Diseconomies of Scale" are associated with a rising LRAC.
Recommended Citation
Crane, Steven E., "(7) Economies of Scale I: The Concept" (2011). Principles of Microeconomics. Paper 55.
http://epublications.marquette.edu/microecon_learning/55
Run Time
9:09
Primary Discipline
Microeconomics
Skills Delivered
Ability to define and explain the concepts of Economies of Scale and Diseconomies of Scale. Ability to relate these concepts to the shape of the Long Run Average Total Cost Curve.
Rigor Level
2000
Prerequisites
Previous Cost Videos