Cost Savings Not Directly Due to Economies of Scope or Economies

question 96

Multiple Choice

Cost savings not directly due to economies of scope or economies of scale are referred to as:

• A)economies of scale.
• B)economies of scope.
• C)x-efficiencies.
• D)none of these.

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Definitions:

Marginal Cost

The cost added by producing one additional unit of a product.

Nondiscriminating Natural Monopoly

A market condition where a single firm can supply the entire market's demand for a good or service at a lower cost than any competitor, without price discrimination.

Marginal Cost

The cost of producing one additional unit of a product or service, a critical concept in economic decision-making.

Average Total Cost

The total cost of production (fixed costs plus variable costs) divided by the quantity of output produced, representing the per unit cost.