Question:

A manufacturing plant exhibits diseconomies of scale if long-run average cost (LRAC) is:

A increasing as output increases, and the plant is at its minimum efficient scale if LRAC is at its lowest level.

Explaination

Diseconomies of scale are present when long-run average cost increases as output increases. The minimum efficient scale is the plant size that produces the quantity of output for which LRAC is at a minimum.