b. Using the table below indicate if the firm has (i) diseconomies of scale (ii)economies of scale or (iii) constant returns to scale over the entire range ofoutput. Explain your answerQuantity(Units ofoutput 1234567Firm A 60708090100110120Firm B112439567596119Firm C2134496685106129c. Evaluate the view that the main goal of firms will always be cost minimization.

The given information illustrates the overall cost of output that each firm experiences at each…

Answered: Using the table below indicate if the…

Microeconomic Theory

12th Edition

ISBN:9781337517942

Author:NICHOLSON

Publisher:NICHOLSON

Chapter9: Production Functions

Section: Chapter Questions

Problem 9.7P

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b. Using the table below indicate if the firm has (i) diseconomies of scale (ii)
economies of scale or (iii) constant returns to scale over the entire range of
output. Explain your answer

Quantity (Units of output	1	2	3	4	5	6	7
Firm A	60	70	80	90	100	110	120
Firm B	11	24	39	56	75	96	119
Firm C	21	34	49	66	85	106	129

c. Evaluate the view that the main goal of firms will always be cost minimization.

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