Economies of Scale Have a Number of Sources, Including the Ability

question 2

Multiple Choice

Economies of scale have a number of sources, including the ability

• A) to average out the variable costs of production.
• B) of large-volume producers to utilize specialized employees and equipment.
• C) to adjust the scale of production based upon product saturation in the marketplace.
• D) to utilize nonspecialized employees interchangeably.

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Definitions:

MRP

Stands for Material Requirements Planning, a system for calculating the materials and components needed to manufacture a product.

Finished Assemblies

Finished Assemblies are completed products that have been assembled from individual components and are ready for sale or use.

Pegging

In material requirements planning systems, tracing upward in the bill of material from the component to the parent item.

Part Requirement

Specification or quantity of a component necessary for completing a manufacturing process or assembling a final product.