Which of the following is an accurate statement about economies of scale?
A)Production costs per unit are less in a large facility than in a small facility
B)The more product a company makes,the lower its variable production costs
C)Economies of scale are identical to throughput
D)Doubling factory size typically doubles fixed costs
E)Companies with economies of scale have high capacity utilization

Question

Quizplus · Accepted Answer

Economies of scale refer to the cost advantages that a firm can achieve by increasing its scale of production. A key feature of economies of scale is that production costs per unit decrease as production volume increases. Thus, production costs per unit are less in a large facility than in a small facility.

Which of the Following Is an Accurate Statement About Economies