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LRATC Envelope Curve
AP Microeconomics · Firm Costs
Long Run Concept

In the Long Run, all inputs (including plant size) are variable. The LRATC is the "envelope" curve of all possible Short-Run Average Total Cost curves.

Returns to Scale
Economies of Scale: LRATC falls as Q increases (specialization / bulk buying).
Constant Returns: LRATC stays constant as Q increases.
Diseconomies of Scale: LRATC rises as Q increases (bureaucracy / communication fails).
Tags
LRATCSRATCReturns to ScaleEnvelope Curve
Firm Output Planner
Target Quantity ($Q$): 50
Dynamic Feedback
Active Plant Size: SRATC 3
Scale Phase: Constant Returns
Minimum Avg Cost: $10.00