The term diseconomies of scope refers to the situation in which the costs of joint production of FI services are higher than they would be if they were produced independently.

Question

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Diseconomies of scope occur when there is a decrease in efficiency and an increase in costs when producing multiple products or services together, rather than separately. In the case of financial intermediation services, producing multiple services together can result in higher costs than producing each service independently.

The Term Diseconomies of Scope Refers to the Situation in Which