Firms have greater flexibility in the long run than in the short run. 1. Explain why there

Question:

Firms have greater flexibility in the long run than in the short run.
1. Explain why there are no fixed costs in the long run.
2. Explain how to derive a long-run average total cost curve.
3. Draw a LRATC curve and use it to show where economies of scale, constant returns to scale, and diseconomies of scale exist. Also use it to show the minimum efficient scale.