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Table 11-8 Represents the Monthly Output of Five Companies in the Electric

Question 12

Multiple Choice

    Table 11-8 represents the monthly output of five companies in the electric scooter manufacturing industry.  Minimum efficient scale in this industry is a monthly output of 27,000 electric scooters, and the industry has a typical U-shaped long-run average cost curve with no constant returns to scale. -Refer to Table 11-8. Which of the following potential mergers would result in the new company experiencing diseconomies of scale? A)  Bandicoot merges with Dugong. B)  Bandicoot merges with Capybara and Echidna. C)  Dugong merges with Aardvark and Capybara. D)  Capybara merges with Aardvark and Echidna.

Table 11-8 represents the monthly output of five companies in the electric scooter manufacturing industry.
Minimum efficient scale in this industry is a monthly output of 27,000 electric scooters, and the industry
has a typical U-shaped long-run average cost curve with no constant returns to scale.
-Refer to Table 11-8. Which of the following potential mergers would result in the new company experiencing diseconomies of scale?


A) Bandicoot merges with Dugong.
B) Bandicoot merges with Capybara and Echidna.
C) Dugong merges with Aardvark and Capybara.
D) Capybara merges with Aardvark and Echidna.

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