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As the Global Market for Eyeglass Products Has Become Extremely

Question 51

Multiple Choice

As the global market for eyeglass products has become extremely competitive in recent months, U-See Products' newly appointed CFO believes the company should address its minimum efficient scale and attempt to lower it. What is a consequence of a low minimum efficient scale?


A) prevents a firm from utilizing capital equipment fully
B) leads to centralized production in a single location or a limited number of locations
C) prevents a firm from accommodating demands for local responsiveness
D) increases the unit cost of products
E) allows a firm to hedge against currency risk by manufacturing the same product in several locations

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