When a Firm Cannot Realize the Cost Savings from Economies

question 55

True/False

When a firm cannot realize the cost savings from economies of scale all by itself, it may join in a strategic alliance with other firms so that together both firms will have sufficient volume to be able to gain the cost advantages of economies of scale.

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Definitions:

Matrix

A hierarchical organizational structure that combines two or more lines of authority, such as product and geographical divisions, creating a grid or matrix of responsibilities.

Delegation

The process of assigning responsibility and authority to someone else in order to complete a clearly defined task while retaining accountability for the outcome.

Accountability

The requirement to show performance results to a supervisor.

Obligation

A duty or commitment that an individual or organization is bound to fulfill, often due to legal, moral, or social reasons.