Assume the marginal cost is strictly increasing and always larger than the fixed cost - in particular, at $q=0$ (no production). Does it imply that the efficient scale is equal to zero? (Define efficient scale as the non-negative level of production q that minimizes the average cost.) Assume $q$ is one-dimensional and all cost functions are continuously differentiable.

  • 3
    $\begingroup$ This seems like a homework or practice problem without any work shown by the questioner. I recommend that you show what you've tried or this question is likely to be closed. $\endgroup$ – BKay Jan 8 at 14:53

Your Answer

By clicking "Post Your Answer", you agree to our terms of service, privacy policy and cookie policy

Browse other questions tagged or ask your own question.