Economies of scale have:
A)No limits
B)Upper limits due to impracticality
C)A positive impact on profit in all cases
D)Been exploited by large firms in the past, so are no longer important.

Question

Quizplus · Accepted Answer

Economies of scale refer to the cost advantages that a firm can gain by producing at a larger scale. However, there are practical limitations to how large a firm can grow before experiencing diminishing returns due to factors such as increased bureaucracy and communication breakdowns. Therefore, there are upper limits to economies of scale due to impracticality.

Economies of Scale Have