The long run average cost curve traces the firm’s lowest attainable average total costs while the short run average cost curve does not. This is because in the long run a firm can change the amount of capital and the amount of labour while in the short run a firm can only change the amount of labour.
List of references:
· PARKIN, M, POWELL, M, MATTHEW, K, 2008. Economics (7e). Essex, England: Pearson.
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