_______ is/are unit cost reductions associated with a large scale of output.

Question

Quizplus · Accepted Answer

Economies of scale refer to cost advantages that are achieved when production is done on a large scale. As the volume of output increases, there is a reduction in the cost per unit due to factors such as increased specialization, improved technology and machinery, and better distribution systems. This, in turn, translates to increased profitability as the company is able to sell its products at a lower cost while still maintaining the same level of quality.

_______ Is/are Unit Cost Reductions Associated with a Large Scale