When a firms long run avg cost curve is horizontal for a range of output, then in that range production displays:

Question

a) constant avg fixed costs
b) increasing returns to scale
c) constant returns to scale
d) decreasing returns to scale

i think d

Answer 1

For the avg cost curve to be flat, it must mean that the marginal cost must equal the average cost. Ergo, the MC curve must also be flat. Go with c)