JAMB Economics 2012 Objective — Question 23

Question 23 of 50 from the Joint Admissions and Matriculation Board (JAMB) Economics 2012 Objective paper, with the correct answer and a full explanation.

The long-run average cost curve touches the short-run average cost curve at the

A. minimum points of all short-run average cost curves
B. declining points of all short-run average cost curves
C. minimum point of only one of the short-run cost curveCorrect
D. rising points of all short-run average cost curves

Explanation

The long run average cost curve touches the short-run average cost curve at the minimum point of one of them (which is called the optimal plant). The rest may touch at the declining parts or at the rising part depending on whether the long run cost is falling or rising.

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