A study of immunizing children in poor countries against diphtheria, pertussis, and tetanus estimated that, in the long run, a 10% increase in the number of children vaccinated increases the total cost of vaccinations by 8.4%. According to this study:

a. Is immunization over this range characterized by economies of scale, constant returns to scale, or diseconomies of scale?

b. We can define long-run marginal cost (LRMC) as the cost of increasing output by one unit when all inputs can be varied (as they can be in the long run). Based on the study, at current vaccine levels, would LRMC for vaccinations be greater than, less than, or equal to long-run average total cost (LRATC)? Why?

c. If we want to know what it will cost to vaccinate additional children, and we use “cost per vaccine” as given by the current LRATC, do we overestimate, underestimate, or accurately estimate the cost per additional vaccine?