Global economies of scale can be realized by:
A) restricting the expansion of overseas sales.
B) limiting the utilization of production facilities.
C) curbing bargaining power with suppliers.
D) decreasing cost savings through learning effects.
E) spreading the fixed costs associated with developing a product.

Question

Quizplus · Accepted Answer

Global economies of scale can be realized by spreading the fixed costs associated with developing a product. This means that as production volume increases, the cost per unit decreases due to the spreading of fixed costs. This allows for greater efficiency and increased profitability. Restricting overseas sales, limiting production facilities, curbing bargaining power with suppliers, and decreasing cost savings through learning effects all hinder the ability to realize global economies of scale.

Global Economies of Scale Can Be Realized By