Question

constant returns to scale cause the long - run average cost curve to be:
a. upward - sloping.
b. downward - sloping.
c. horizontal.
d. vertical.

Explanation:

Constant returns to scale mean that when all inputs are increased by a certain proportion, output increases by the same proportion. This results in long-run average total cost remaining unchanged as output expands, which corresponds to a horizontal long-run average cost curve. Upward-sloping curves relate to decreasing returns to scale, downward-sloping to increasing returns to scale, and vertical curves do not apply to cost-output relationships here.

Answer:

c. horizontal.