Likewise, it has diseconomies of scale ( is operating in an upward sloping region of the long-run average cost curve ) if and only if it has decreasing returns to scale, and has neither economies nor diseconomies of scale if it has constant returns to scale.
32.
Likewise, it has diseconomies of scale ( is operating in an upward sloping region of the long-run average cost curve ) if and only if it has decreasing returns to scale, and has neither economies nor diseconomies of scale if it has constant returns to scale.
33.
In this case, with perfect competition in the output market the long-run market equilibrium will involve all firms operating at the minimum point of their long-run average cost curves ( i . e ., at the borderline between economies and diseconomies of scale ).
34.
For example, if there are increasing returns to scale in some range of output levels, but the firm is so big in one or more input markets that increasing its purchases of an input drives up the input's per-unit cost, then the firm could have diseconomies of scale in that range of output levels.
