Question

Margaret owns a stuffed animal shop. At first, it is just she and her daughter Allison hand-sewing stuffed bears, stuffed sharks, and stuffed giraffes in the spare bedroom. Over time, Margaret decides to rent a larger shop and hire more workers to help out, increasing to a staff of 20 people. Everything is still hand sewn. She notices, however, that her stuffed animal output increased much more than tenfold despite her work force increasing by that amount. However, any more than 20 workers slows down production. This is an example of O ncreasing marginal productivity O Economies of scale O Alternative production technologies O Increased average cost.

Answer 1

Answer:

Economies of scale.

Explanation:

Economy of scale  means a proportionate saving in costs gained by an increased level of production.