7. Costs in the short run versus in the long run

Ike's Bikes is a major manufacturer of bicycles. Currently, the company produces bikes using only one factory. However, it is considering expanding production to two or even three factories. The following table shows the company's average total cost each month for various levels of production if it uses one, two, or three factories. (Note: QQequals the total quantity of bikes produced by all factories.)

\fBOO A 720 ATC 340 580 480 -0- 400 AVERAGE TOTAL COST (Dollars per bike) 320 O- 240 LRAC 180 80 600 700 100 300 400 500 200 QUANTITY OF OUTPUT (Bikes)In the long run, over which range of output levels does Ike's Bikes experience constant average cost? O More than 400 bikes per month O Fewer than 300 bikes per month O Between 300 and 400 bikes per month