Respond to the following response below:

How can the long-run average cost (LRAC) curve be derived from the short-run average total cost (SRATC) curve?

LRAC known as long-run average costs represents the lowest attainable average cost of producing any given output and is a curve that shows all possible sort-run average costs curves. The long-run average cost curve is derived from the short-run average total costs after finding the lowest average total cost at each level of output.

Describe economies of scale and diseconomies of scale.

Economies of scale are considered declines in long-run average costs that are due to increased plant size and happens when a business is growing and production costs start to decrease which means that the business is continuing to grow at a good rate and the production chain is efficient. Diseconomies of scale are found as increases in long-run average costs that are due to increased plant size and is considered as the inverse of economies of scale which is where prices of an item or product increases as output of the similar item or product decreases.

What are the determinants of economies of scale and diseconomies of scale, respectively?

The determinants of economies of scale would be factors that also affect fixed costs, quantity and quality of products and services, and efficiency with the products that help minimize the costs and purchasing products in bulk would help save on products. The determinants for diseconomies of scale are considered issues like poor communication, coordination problems, and also poor management skills within the company which could start the company to lose focus and fail to control the market costs and production levels.

Using a real-world company (other than Sysco), explain the causes of economies of scale for your company.

The company I would use is Wal--Mart and I feel the causes of economies of scale for my company would be the size and advance in technologythese day and with Wal-Mart being such a big brand and company they are able to purchase plenty products in bulk and provide them to the community at a fixed rate.

Explain how economies of scale help your company compete in its industry.

Economies of scale could help my company compete in this industry by minimizing product costs for the company and set prices a little higher to have a increase in profits gained and use the economies of scale to figure out the lowest costs to purchase a product and sell to the customers to benefit for even more while also offering low prices that benefit both Wal-Mart and the customers buying the product.