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9. The concept of ___________________ means that as the scale of output goes up, the average costs of production decline—at least up to a point. 

a. economies of scope

b. economies of scale

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2 Nov 2020

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Related questions

1. The law of diminishing marginal productivity states that 

a. As you expand output, your marginal productivity eventually increases

b. As you expand output, your marginal productivity eventually declines

c. As you expand output, the total product eventually increases

2. What are economies of scale?

a. decreasing average costs as production increases

b. increasing average costs as production increases

c. increasing fixed costs as production increases

d. None of the above

3. What are economies of scope?

a. lower average costs when multiple different products are produced

b. higher average costs when multiple different products are produced

c. Constant average costs when multiple different products are produced

d. None of the above

4. It costs firm A $800 to produce five radios and it costs firm B $500 to produce five batteries. If Firm A merges with firm B, it can produce both the five radios and the five batteries for $1000. The firm has experienced

a. Economies of scale

b. Economies of scope

c. Diseconomies of scale

d. Diseconomies of scope

5. It costs firm A $800 to produce five radios and it costs firm B $500 to produce five batteries. If Firm A merges with firm B, it can produce both the five radios and the five batteries for $1500. The firm has experienced

a. Economies of scale

b. Economies of scope

c. Diseconomies of scale

d. Diseconomies of scope

) The Johnson Corporation produces 1000 wood cabinets and 500 wood desks per year, for total cost of $30,000. It has been estimated that if the firm produced 1000 wood cabinets only, the cost would be $23,000, and if the firm produced 500 wood desks only, the cost would be $11,000.

Calculate the degree of economies of scope and interpret your findings.

What explains economies of scope and economies of scale in production? What is the difference between economies of scope and economies of scale? Provide at least two examples for each case.

When_____ exist, the doubling of all inputs will result in more than doubling output, which means _________.

A- economies of scale; a smaller factory can produce at a lower average cost than a larger company.

B- economies of scale; a larger factory can produce at a lower average cost than a smaller company

C- labor inputs; economies-of-scale curve U-shpaed

D- lower labor inputs; the larger scale of production leads to higher costs

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