16-85 Why Has Empirical Evidence on Economies of Scale and Scope

question 101

Multiple Choice

16-85 Why has empirical evidence on economies of scale and scope been so contradictory?

• A)Data on bank costs are unavailable.
• B)Efficiency may be related to overall market conditions.
• C)Efficiency may be related to non-quantifiable variables such as managerial ability.
• D)Neither the intermediation nor the production approach conform to reality.
• E)The methodology to detect economies of scale and scope are still very rudimentary.

---

Definitions:

Median Income

The middle value of income in a given population, such that half earn more and half earn less.

Poverty Rate

The poverty rate is a statistical measure that estimates the percentage of the population living below the poverty line, based on income or consumption levels.

World's Population

The total number of people living on Earth at a given time, which is subject to change due to birth rates, death rates, and migration patterns.

Government Assistance

Programs and services provided by the government aimed at supporting individuals, groups, or sectors in need, including welfare, subsidies, and grants.