-Describe why diminishing marginal product of labor only apply to the short run and not the long run production process. - Describe how the minimum efficient scale (MES) can be used as a proxy for the number of firms that compete in a domestic market.

- Diagram the short-run average cost curves graph. - Diagram the long-run average cost curve graph.

-Assume Industry As' MES is 13%. Based on this information what is the approximate number of firms that compete in the industry? A. 8

B. 9

C. 5

D. 4