Suppose a firm's cost-output elasticity (Upper E Subscript Upper CEC) is 0.390.39. Part 2 If so, then this firm's cost function exhibits economies of scale . Part 3 What is this firm's scale economies index (SCI)? Part 4 The SCI for this firm is enter your response here. (Enter your response rounded to two decimal places.)
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The cost-output elasticity measures how the cost of production changes in response to a change in output. A CEC less than 1 indicates economies of scale, meaning that as output increases, the cost per unit decreases. Show more…
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