What does it indicate when the long-run average cost curve slopes downward from left to right?

Explanation

A downward-sloping long-run average cost curve signifies increasing returns to scale, meaning that as production expands, average costs decrease. Conversely, decreasing returns to scale would cause the curve to slope upward, constant returns to scale would result in a flat curve, and the minimum efficient scale refers to the lowest output level at which long-run average costs are minimized.