Economics 9708 · AS & A Level · 7.5

7.5 — practice question

The diagram illustrates the long-run average cost curves (LRAC) for a firm. Which pair of movements correctly describes each type of economy or diseconomy of scale?

  • Ainternal economies of scale: W to Y; internal diseconomies of scale: X to W; external economies of scale: Z to W
  • Binternal economies of scale: W to Y; internal diseconomies of scale: Y to W; external economies of scale: Z to W
  • Cinternal economies of scale: X to Y; internal diseconomies of scale: W to Z; external economies of scale: W to Y
  • Dinternal economies of scale: X to Y; internal diseconomies of scale: Y to X; external economies of scale: W to Y

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