I have a query in this question:
The fall in a firm’s SRAC with an increase in production would be due to which of the following?
a. The greater divisibility of fixed costs
b. Diminishing returns to a fixed factor
c. Economies of scale
d. Diseconomies of scale
Why is the answer a and not b?
Thanks
Regards,
Shyam
Edit: Got the answer!
Last edited: Aug 31, 2016