Economies of scope exist when multiple products can be produced at a lower cost in combination than they can separately.

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Economies of scope refer to the cost advantage that a firm has when it produces two or more products together, rather than producing each product separately. This typically results from shared resources, such as production facilities or distribution networks, that allow the firm to produce multiple products more efficiently and at a lower cost.

Economies of Scope Exist When Multiple Products Can Be Produced