When There Are External Economies of Scale,an Increase in the Size

question 27

Multiple Choice

When there are external economies of scale,an increase in the size of the market will

• A) increase the number of firms and lower the price per unit.
• B) increase the number of firms and raise the price per unit.
• C) decrease the number of firms and raise the price per unit.
• D) decrease the number of firms and lower the price per unit.
• E) not affect the number of firms, but will lower the price per unit.

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Definitions:

Strategy

A plan of action designed to achieve a long-term or overall aim.

Effectuating Approach

A strategic framework used in entrepreneurship that focuses on using available resources and means to achieve new goals, rather than setting goals first and then seeking resources.

Entrepreneur

An individual who creates, launches, and manages a new business venture, often taking on significant financial risks.

Pattern Recognition

The ability to identify and understand regularities, repetitions, or trends in data, situations, or physical objects.