Minneapolis business Rogue Chocolatier sells specialty chocolate bars with a high cocoa content. If Rogue's average total cost decreases as the business increases plant size, then Rogue experiences
A) economies of scale.
B) diseconomies of scale.
C) diminishing marginal returns.
D) constant returns to scale.

Question

Quizplus · Accepted Answer

Economies of scale occur when a firm's average total cost decreases as it increases production or plant size, due to factors like spreading fixed costs over more units or operational efficiencies.

Minneapolis Business Rogue Chocolatier Sells Specialty Chocolate Bars with a High