The savings that a large company can enjoy from producing goods in high volume,that are not available to a small company are called:
A)economies of scale.
B)horizontal integration.
C)vertical integration.
D)economies of scope.

Question

Quizplus · Accepted Answer

Economies of scale refer to the cost advantages that a company can achieve by producing goods in high volume. Large companies can benefit from economies of scale because they can spread their fixed costs over a larger number of units, which reduces the cost per unit. Small companies, on the other hand, may not be able to produce enough units to benefit from economies of scale.

The Savings That a Large Company Can Enjoy from Producing