Examlex
When evaluating the six-step decision-making process, what occurs during the solution selection step?
Economies Of Scale
They refer to the cost advantages that enterprises obtain due to their scale of operation, with cost per unit of output generally decreasing with increasing scale as fixed costs are spread out over more units of output.
Pin Factory
Illustration by Adam Smith in "The Wealth of Nations" on how division of labor increases productivity, using a pin factory as an example.
Diminishing Returns
The principle stating that if one factor of production is increased while others remain constant, the overall returns will initially increase but there will come a point where the added benefits will start to decrease.
Increasing Returns
An increase in firm’s output by a larger percentage than the percentage increase in its inputs.
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