If the output rate for a given level of capacity is less than the optimum level,then ______.
A)increasing the output level reduces economies of scale
B)increasing the output level increases economies of scale
C)decreasing the output level increases economies of scale
D)decreasing the output level maintains economies of scale

Question

Quizplus · Accepted Answer

Increasing the output level reduces economies of scale because the output rate is less than the optimum level, meaning that the firm is not operating at its most efficient scale.

If the Output Rate for a Given Level of Capacity