Question

What is implied when the total cost of producing Q1 and Q2 together is less than the total cost of producing Q1 and Q2 separately? A. Diseconomies of Scale B. Economies of Scale C. Diseconomies of Scope D. Economies of Scope

Answer 1

Answer:

The correct answer is D. Economies of scope.

Explanation:

The Economies of scope means the reduction of the average costs under the production of two or more products or services together. This must always be observed in the production process, in order to strategically plan the entire internal production process of the company. By implementing this type of joint production, great savings are achieved in own production factors, seeking effective diversification in the market.