The necessary condition(s)to realize economies of scale include
A)having the financial resources for the high capital costs.
B)having sufficient demand for the product.
C)both financial resources for the high capital costs and sufficient demand for the product.

Question

Quizplus · Accepted Answer

Both financial resources for the high capital costs and sufficient demand for the product are necessary conditions to realize economies of scale. Without sufficient demand for the product, it will not be possible to achieve the larger production levels required for economies of scale. Similarly, without the financial resources required to make the necessary investments in capital equipment, it will not be possible to achieve the cost savings associated with economies of scale.

The Necessary Condition(s)to Realize Economies of Scale Include