Asked by Jacob Thomas on Jun 16, 2024
Verified
Refer to Figure 7.6.1. A movement from A to B in the figure represents:
A) economies of scale.
B) diseconomies of scale.
C) learning.
D) economies of scope.
E) diseconomies of scope.
Economies of Scale
The cost advantages that enterprises obtain due to their scale of operation, which often leads to a reduction in average cost per unit as scale is increased.
Economies of Scope
Cost advantages that a business experiences by expanding the variety of products or services it offers, leveraging shared operations or resources.
- Comprehend the principle of economies of scope and distinguish it from economies of scale.
- Discriminate between the consequences of learning curves and economies of scale on the costs involved in production.
Verified Answer
MA
Munira AlbuloshiJun 21, 2024
Final Answer :
A
Explanation :
A movement from A to B typically represents economies of scale, which occur when increasing production leads to lower average costs.
Learning Objectives
- Comprehend the principle of economies of scope and distinguish it from economies of scale.
- Discriminate between the consequences of learning curves and economies of scale on the costs involved in production.