S. Costs in the short run versus in the long run Ike's Bikes is a major manufacturer of bicydes. 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 short-run average total cost (SRATC) each month for various levels of production it it uses one, two, or three factories. (Note: O equals the total quantity of bikes produced by all factories.) Number of factories 1 Average Total Cost (Dollars per bike) Q=300 Q = 400 240 320 Q = 100 440 Q=200 280 Q = 500 480 Q = 600 800 2 620 380 240 620 3 240 240 380 230 800 480 320 440 Suppose Ike's Bikes is currently producing 600 bikes per month in its only factory. Its short-run average total cost is 5 per bike Suppose Ike's Bikes is expecting to produce 600 bikes per month for several years. In this case, in the long run, it would choose to produce bikes using On the following graph, plot the three SRATC curves for Ike's Bikes from the previous table. Specifically, use the green points (triangle symbol) to plot its SRATC curve if it operates one factory (SRATC); use the purple points (diamond symbol) to plotits SRATC curve if it operates two factories SRATC2); and use the orange points (square symbol) to plotits SRATC curved operates three factories (SRAZC). Finally, for the long-run, average total cost (LRATC) curve for the's Bikes using the blue points (circle symbol). Note: Plot your points in the order in which you would like them connected. Line segments will connect the points automatically 100 120 >> 540 SRATC 000 SRATC AVERAGE TOTAL COST (Dollart per bike) 230 SRATC 240 105 LRATC 220 AVERAGE TOTALCO 240 SRATC 180 O 80 LRATC O D 100 200 300 400 QUANTITY Bikes) 500 800 700 In the following table, indicate whether the long-run average cost curve exhibits economies of scale, constant returns to scale, or diseconomies o scale for each range of bike production, Range Economies of Scale Constant Returns to Scale Diseconomies of Scale Fewer than 300 bikes per month 0 More than 400 bikes per month Between 300 and 400 bikes per month