What is an economy of scale?
A)Paying off variable costs as soon as possible
B)Spreading fixed costs over a large number of units
C)Introducing products into as many countries as possible
D)Attracting the most customers as possible
E)Avoiding finance charges by assuming less debt

Question

Quizplus · Accepted Answer

Economy of scale refers to the cost advantages a company obtains due to an increase in production. Spreading fixed costs over a large number of units is a common way to achieve economies of scale. This can result in a lower cost per unit and increased profitability.

What Is an Economy of Scale