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balu736 [363]
2 years ago
6

When a firm grows larger, many additional layers of managers are sometimes added that do not actually produce any output. At the

same time, the firm gains additional bargaining power over the prices it pays to its suppliers. If both of these factors have an equal effect, we would expect this firm to experience:________A. diminishing marginal returns.B. diseconomies of scale.C. constant returns to scale.D. economies of scale.
Business
1 answer:
notsponge [240]2 years ago
6 0

Answer:

C

Explanation:

C) constant returns to scale.

Returns on scale - when an increase in inputs (capital and labour) cause the same proportional increase in output.

Both the factor nullifies the effects of each other as managerial inefficiency will decrease the effect of external economies of scale in form of bargaining power so constant return to scale is expected.

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The correct answer between all the choices given is the third choice or letter C. I am hoping that this answer has satisfied your query and it will be able to help you in your endeavor, and if you would like, feel free to ask another question.

<span> </span>

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