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Economies of Scale and Profits

Economies of Scale and Profits. How reductions in long run average cost can lead to lower prices and higher profits. Economies of Scale and Profits. Price and cost. LRMC. LRAC. Output. Economies of Scale and Profits. Price and cost. P1. LRMC. C1. LRAC. AR. MR. Q1. Output.

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Economies of Scale and Profits

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  1. Economies of Scale and Profits How reductions in long run average cost can lead to lower prices and higher profits

  2. Economies of Scale and Profits Price and cost LRMC LRAC Output

  3. Economies of Scale and Profits Price and cost P1 LRMC C1 LRAC AR MR Q1 Output

  4. Economies of Scale and Profits Price and cost P1 LRMC P2 C2 LRAC AR2 AR MR2 MR Q1 Q2 Output

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