what are Multi-Plant Adjustments:
A monopolist may operate more than one plant. In the short-run, he can operate any number of plants of the same size or of different sizes. But in the long-run, he operates only those plants which together bring in larger profits. Given each plant of the same size and of identical cost conditions, he will have each plant of that size where the long-run average cost curve LAC and the SAC curve touch each other at their minimum points.
If in the short-run, the monopolist operates four plants, he may reduce them to two in the long-run by employing more efficient plants so that the long-run average and marginal costs are lowered and he earns larger profits. Like the single plant monopoly, the multi-plant monopoly adjustment in the long-run may be followed by quantity and price changes. But in the case of multi-plant monopoly the firm will operate at the minimum long-run average costs to gain maximum profits.
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