Use the following graphs to answer the next question.  For which graph are there economies of scale throughout the entire range of output of cars?

To determine which graph shows economies of scale throughout the entire range of output for cars, we need to understand the concept of economies of scale.

Economies of scale occur when the average cost of production decreases as the quantity produced increases. This typically results in a downward-sloping curve for average cost (AC) in relation to output (Q).

Without the specific graphs to analyze, I can provide guidance on what to look for:

1. Look for a downward-sloping average cost curve: Identify a graph where the average cost continues to decrease as the quantity of cars produced increases. This indicates economies of scale.

2. Assess the entire output range: Ensure that this downward trend persists for all levels of output depicted in the graph, meaning that as production levels rise, costs do not begin to increase at any point.

3. Select the correct graph: The graph that meets these criteria—showing a continually decreasing average cost across all output levels—will be the one that reflects economies of scale throughout the entire range.

Final Answer

In conclusion, select the graph that demonstrates a consistently downward-sloping average cost line for all output levels to identify economies of scale throughout the entire range of output for cars.