Assume the following: • A firm is experiencing diseconomies of scale (decreasing returns to scale) • The firm decides to decrease its quantity of output because of concerns that the firm has become too complex What will happen to the long-run average total cost of the firm? a. Decrease b. Increase c. Remain Constant d. This is unpredictable

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Cost of Production

The entire idea of the cost of production or production cost is applied corresponding, or we can say that it is related to monetary cost. Money cost refers to any money expenditure which the firm or supplier, or producer undertakes in purchasing or hiring factor of production or factor services.