Economies of scope exist when it is less expensive to produce two or more product lines in a single firm than it is to produce them separately.

Question

Quizplus · Accepted Answer

Economies of scope refer to the cost advantages that arise when a firm produces multiple products together rather than separately. This can result in lower production costs, shared resources, and greater efficiency. Therefore, it is true that economies of scope exist when it is less expensive to produce two or more product lines in a single firm than it is to produce them separately.

Economies of Scope Exist When It Is Less Expensive to Produce