Reductions in average costs that result from producing two or more products jointly instead of producing them separately are called ________.
A) cost advantages
B) economies of scope
C) synergistic integrations
D) strategic values

Question

Quizplus · Accepted Answer

The term used to describe producing two or more products jointly instead of producing them separately is economies of scope. This results in cost savings and reductions in average costs for the firm. Therefore, option B, economies of scope, is the correct answer. Option A, cost advantages, is too broad and can encompass other types of cost savings, not just economies of scope. Option C, synergistic integrations, is not a commonly used term and is not directly related to the concept of producing multiple products jointly. Option D, strategic values, is not related to the concept of cost savings from joint production.

Reductions in Average Costs That Result from Producing Two or More