Answer:
a. The capacity to serve must be greater than the average demand.
Step-by-step explanation:
- For the service to last in the long runs at a satisfactory rate the demand of the product or service should be of a long term, as the car machinery to work and run efficiency should be cleaned, oiled and air should be checked as to keep it running for the long run.
- The as long run is the period of time where all the factors of the production and costs are variable and thus a firm needs to adjust to these costs s compared to the short run where the firms are able to influence the price by adjustments.