Examples of Economies of Scale Are

question 18

Multiple Choice

Examples of economies of scale are:

• A) the additional fees financial intermediaries charge on small accounts.
• B) the decrease in overall transaction costs that occur as volume increases.
• C) the reduction in the cost per transaction that occurs as the number of transactions increase.
• D) the decrease in overall information costs that occurs as more transactions are handled.

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Definitions:

Annual Interest

The amount of money that is paid in interest on an investment, loan, or savings account over the course of a year.

Maturity

The stage in an entity's life cycle, whether a financial instrument, product, or organism, where growth has stopped and it has reached full development.

Borrower Characteristics

Characteristics that describe individuals or entities seeking loans, including their credit history, income level, and financial stability.

Taxability

The condition of being subject to taxation by governmental authorities.