______ occurs when a single firm can produce two or more products more cheaply than two separate firms.
A) Economies of scale
B) Economies of scope
C) Diseconomies of scale
D) Increasing returns to scale

Question

Quizplus · Accepted Answer

Economies of scope occur when a single firm can produce two or more products more cheaply than two separate firms. This is because the fixed costs (e.g. buildings, equipment, management) can be shared between the products, resulting in lower average costs for each.

______ Occurs When a Single Firm Can Produce Two or More