What Is the Difference Between Economies of Scale and Economies

question 37

Multiple Choice

What is the difference between economies of scale and economies of scope?

• A)Scale refers to the magnitude or size of the operation, while scope refers to the reach of defined savings within the value chain.
• B)Scale refers to the extent of change, while scope refers to the possibilities of change.
• C)Scale is about dimensions, while scope is about the capacity available for production capabilities.
• D)Scale refers to cost savings that accrue directly from larger-sized operations, while scope stems directly from strategic fit along the value chains of related businesses.
• E)Scale and scope mean the same thing and the only difference is the extent of cost savings accrued from unrelated businesses in each.

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Definitions:

Consumption Time

The period during which consumers use or enjoy a good or service.

Theory of Consumer Behavior

A framework that examines how consumers make decisions to allocate their resources on consumption-related items.

Marginal Utility

The increased pleasure received from consuming an extra unit of a good or service.

Rational Consumer

A consumer who systematically and logically evaluates available options to maximize their satisfaction or utility in decision-making processes.