The Following Information Is Available on the Average Costs of the Three

question 87

Multiple Choice

The following information is available on the average costs of the three major banks in a given local market.Bank A has assets of $10 million and average costs are 15 percent, Bank B has assets of $20 million and average costs of 13 percent while Bank C has assets of $30 million with average costs of 12 percent.Average costs are measured as a proportion of total assets. The above figures indicate that

• A)there are significant economies of scale still present in the local markets.
• B)there are significant diseconomies of scale still present in the local markets.
• C)there are significant economies of scope still present in the local markets.
• D)there are significant diseconomies of scope still present in the local markets.
• E)there is not enough information to determine economies of scale or scope.

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Definitions:

Christmas Shopping

The purchasing of gifts, decorations, and other festive items in preparation for the Christmas season, typically involving increased retail activity.

Purchase Requisition

A document or electronic form used to formally request the purchase of goods or services within an organization.

Purchase Order

An official document issued by a buyer to a seller, indicating the type, quantities, and agreed prices for products or services.

Invoice

A document issued by a seller to a buyer that specifies the goods or services provided, their prices, and the total amount owed.