Which term best describes the effect that occurs when production volume increases and unit costs decline?
A) competitive advantage
B) experience curve
C) virtuous circles
D) single sourcing

Question

Quizplus · Accepted Answer

The term that best describes the effect that occurs when production volume increases and unit costs decline is the experience curve. This refers to the observed pattern that as a company produces more units of a product, it gains experience and efficiency that allows it to lower its unit costs. This, in turn, can give the company a competitive advantage and create virtuous circles of cost savings and increased production. Single sourcing refers to a purchasing strategy where a company buys all its supplies from a single supplier.

Which Term Best Describes the Effect That Occurs When Production