Cost savings that the firm accrues when it successfully shares some of its resources and activities or some of its core competencies between its businesses are called
A) core economies.
B) economies of competence.
C) economies of scope.
D) economies of scale.

Question

Quizplus · Accepted Answer

Cost savings that result from sharing common resources, such as production equipment, distribution channels, or management expertise, between different businesses or divisions of the firm are called economies of scope. These cost savings increase the efficiency and competitiveness of the firm as a whole, and allow it to better leverage its core competencies across its various operations.

Cost Savings That the Firm Accrues When It Successfully Shares