All of the following are reasons for economies of scale EXCEPT
A) diminishing marginal product.
B) specialization.
C) dimensional factors.
D) more efficient production equipment.

Question

Quizplus · Accepted Answer

Economies of scale refer to the cost advantages that enterprises obtain due to their scale of operation, with cost per unit of output generally decreasing with increasing scale. Diminishing marginal product is not a reason for economies of scale; rather, it is a concept from the theory of production that describes a decrease in the incremental output produced with an additional unit of input, after a certain point. Specialization, dimensional factors, and more efficient production equipment, on the other hand, are all factors that contribute to economies of scale by increasing efficiency and reducing costs per unit of output.

All of the Following Are Reasons for Economies of Scale