Minimum Efficient Scale (MES)-In the long run, given

4.4 Minimum Efficient Scale (MES):
In the long run, given sufficient
demand for their output, managers can reduce their cost of production per unit
of output and increase profits by expanding the size of any given plant
facility (e.g., factory, mill, shop, store, office building) to its minimum
efficient scale, at which average total cost of production (LAC) is minimized.
Firms achieve minimum efficient scale of their operating facilities at
different levels of output in different industries; therefore they produce
using different plant sizes in different industries. In industries where there
is a large range of output over which firms can achieve constant returns to
scale, firms with relatively small plants can compete on a cost-basis against
firms that use much bigger plant facilities.
Minimum Efficient Scale (MES):
Do: In the long run, given
sufficient market demand for your product or products, expand each of your
operating facility’s production capacity at least to the minimum efficient
scale of output.
Don’t: Don’t use more than one plant
facility to produce a level of output that could be produced at a lower average
cost per unit by using only one plant facility.

Question
on Minimum Efficient Scale (MES):
4.4.1 Use returns to scale
principles to explain why firms’ managers usually expand production, beyond
some level of output at any plant facility, by building new plant facilities.