The Figure Below Shows a Family of Cost Curves for a Firm.The

Multiple Choice

The figure below shows a family of cost curves for a firm.The subscripts 1,2,and 3 for the SRATC curves refer to different plant sizes. FIGURE 8-3
-Refer to Figure 8-3.If this firm is producing at point B,then

A) this firm is producing a level of output that is technically inefficient in the long run.
B) this firm is experiencing decreasing returns to scale.
C) this firm could produce the same level of output at a lower cost with plant size 2.
D) it should employ more of its variable factors of production.
E) plant size 1 is optimal.