The long-run average cost of a firm is the cost of a single unit of producing a commodity over a more extended period, with the inputs involved being variable and a flexible scale of production. In this state, there are no fixed costs hence the unavailability of average fixed costs. The long-run average cost has a curve that depicts a single quantity's production cost within an extended period.

Therefore, the long-run average cost is determined by dividing the entire expenses incurred within a long period with the output quantity emanating from the production process.

The long-run average cost can also be determined by finding out the average cost curve at the lowest point evident per output level.

Average Cost:

Also described as per unit total cost, the average cost is the end product of the division of the total cost of a commodity with the total output. Periods are a significant consideration in the determination of the average cost. The average cost is broken into short-run and long-run. Average costs have a noticeable effect on the supply curve.