A firm with a lower unit cost from producing a wider range of goods and services has economies of
A)transactions costs.
B)scale.
C)scope.
D)team production.
E)market coordination.

Question

Quizplus · Accepted Answer

Economies of scope refer to the cost advantage that firms may achieve when they produce a variety of goods and services, using the same resources and capabilities. By doing so, the firm can spread its fixed costs over a larger number of outputs and benefit from higher productivity and efficiency. This can result in lower unit costs compared to a firm that specializes in one product or service only.

A Firm with a Lower Unit Cost from Producing a Wider