Microeconomics 3

Prior to beginning work on this discussion, read David Trainer’s article, Sysco Feasts on Economies of Scale for Strong Competitive Advantage, as well as Chapter 8 in your textbook, and respond to the following:

• How can the long-run average cost (LRAC) curve be derived from the short-run average total cost (SRATC) curve?
• Describe economies of scale and diseconomies of scale.
• What are the determinants of economies of scale and diseconomies of scale, respectively?
• Using a real-world company (other than Sysco), explain the causes of economies of scale for your company.
• How would economies of scale help your company compete in its industry?

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