When Simple Semiconductors Was Operating at the Minimum Efficient Scale

question 91

Multiple Choice

When Simple Semiconductors was operating at the minimum efficient scale of 10,000-12,000 units per month, the firm's cost per unit was $45. However, when the output level was increased beyond 12,000 units, the cost per unit increased to $47. This increase was attributed to the wear-and-tear of the machinery, and complexities of managing and coordinating. What is this phenomenon known as?

• A) minimum efficient scale
• B) diseconomies of scale
• C) experience curve effect
• D) learning-curve effect

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