he short-run and long-run average cost functions of a firm are generally U-shaped. This implies high unit costs of production at very low and high levels of output. (a) Illustrating you answer with appropriate diagrams, discuss the reasons/factors behind the u-shaped short-run average cost (SAVC) curves of a producing firm. (b) Discuss in detail the factors/causes behind the u-shaped long-run average cost curves (LATC) of a producing firm

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