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Why don't firms try to maximize their economies of scale and run their operations on the largest possible scale?
Factory Machinery
Heavy equipment and tools used in a manufacturing or production environment to produce goods.
Factory Overhead Cost
Expenses related to the operation of a manufacturing facility that are not directly tied to a specific product, including utilities, depreciation, and maintenance.
Depreciation
The process of allocating the cost of a tangible asset over its useful life, reflecting the decrease in value over time.
Factory Overhead Cost
Indirect costs associated with manufacturing, such as maintenance, utilities, and salaries of supervisors, not directly tied to specific product units.
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