Economies of Scale Result as a Firm Increases in Size

question 48

Multiple Choice

Economies of scale result as a firm increases in size and expands its use of resources.Productivity increases and fixed production costs are spread over an increased number of goods and services.Which of the following are types of economies of scale?

• A) Command economies
• B) External economies
• C) Open economies
• D) Closed economies

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Definitions:

Accrued Interest

Interest that has been incurred but not yet paid, often referring to the interest accruing on a bond between payment periods.

Sale Received

The funds collected from the sale of goods or services.

Accrued Interest

Interest that has accumulated on a loan or bond since the last payment date but has not yet been paid out.

Commission

A fee paid to an agent or employee for transacting a sale, which is typically a percentage of the sale price.