Which Statement About Economies of Scope Is Not True

question 11

Multiple Choice

Which statement about economies of scope is not true?

• A)Economies of scope are often attained through programmable automation.
• B)Economies of scope bring together two competitive priorities-customization and low price.
• C)Economies of scope reflect the ability to produce multiple products more cheaply in combination than separately.
• D)Economies of scope reflect low capital intensity and high resource flexibility.

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Definitions:

Worst-case Scenario

The most adverse, negative outcome that could possibly occur in a situation, often used in risk assessment and planning.

Variable Costs

Costs that change in proportion to the level of production or sales. They increase as production increases and decrease as production decreases.

Fixed Costs

Costs that remain constant regardless of the amount of production or business operations.

Contribution Margin

The difference between sales revenue and variable costs of a product or service, indicating the amount contributed towards covering fixed costs and generating profit.