Economies of scale can occur as a result of which of the following?
A) increasing marginal returns as the firm increases its size
B) lower fixed cost as the firm increases its size
C) management difficulties as the firm increases its size
D) greater specialization of labor and capital as the firm increases its size
E) increased total cost when the firm increases its size

Question

Quizplus · Accepted Answer

Economies of scale occur when a firm's average costs decrease as it increases production. Greater specialization of labor and capital allows for more efficient production processes, contributing to economies of scale.

Economies of Scale Can Occur as a Result of Which