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

Question

Quizplus · Accepted Answer

Economies of scale refer to cost advantages that a company can achieve by increasing the scale of production. As production levels go up, the cost per unit of production generally goes down due to factors like better utilization of resources, specialization of labor, and increased bargaining power with suppliers. These cost advantages are difficult for smaller companies to replicate, giving larger companies a distinct advantage in terms of cost competitiveness.

The Fact That a Large Company Can Enjoy Savings from Producing