the president of toyota's georgetown plant was quoted as saying, "Demand for high volumes saps your energy. Over a period of time, it eroded our focus (and) thinned out the expertise and knowledge we painstakingly built up over the years." Based on this quote, what must be true of the plant's average cost of production curve?
a it is u-shaped
b it is upward sloping
c it is a ray from the origin
d. it is downward sloping
Ans.- It is upward sloping
His quote suggests that as toyota expanded its capacity,it experienced diseconomies of scale.Hence, AC curve is upward sloping.
the president of toyota's georgetown plant was quoted as saying, "Demand for high volumes saps your...