Economies of scale arise when the average cost of production falls
A) as the number of units falls.
B) as the number of units rises.
C) as specific experience skills decline.
D) as specific experience skills increase.
E) as profits increase.

Question

Quizplus · Accepted Answer

Economies of scale refer to the decrease in average cost of production as the number of units produced increases. This is because fixed costs are spread over a larger number of units, leading to greater efficiency and cost savings.

Economies of Scale Arise When the Average Cost of Production