Learning economies differ from economies of scale because
A)the former involves rising average costs and the latter involves falling average costs as a result of higher output levels.
B)the former involves output in a single period of production and the latter involves cumulative output.
C)the former involves cumulative production and the latter involves rate of production per period.
D)the first is a short-run phenomenon and the second is a long-run phenomenon.

Question

Quizplus · Accepted Answer

Learning economies are associated with cumulative production, meaning that as a company produces more over time, it learns how to do so more efficiently. Economies of scale, on the other hand, relate to the rate of production per period, where costs per unit decrease as the volume of production increases in a given period.

Learning Economies Differ from Economies of Scale Because