Economies of scale say that a company will lower its production cost as time passes because production becomes more efficient over time. The concept is all about some of the factors that are related to production cost and learning curve.
Some factors are internal such as efficient management of resources, training employees, reducing wastes, etc.
The standard time set by the production manager to stitch a shoe is 30 minutes. A worker who has worked for several hours on stitching shoes has built up a speed and now he is able to stitch a shoe in 24 minutes. This way the worker is now able to make 5 shoes in two hours (24 minutes x 5 = 120 minutes) instead of (30 minutes x 4 = 120 minutes). This way the labor cost has reduced over time.
Explain briefly how economies of scale and scope can be developed in
Plant, Inc., is considering making an offer to purchase Palmer
Define each of the following terms: a. Operating plan
Consider the following table of long-run total costs for three
The following cost-output data were obtained as part of a
Hatfield Medical Supplies’ stock price had been lagging its industry averages,
Define economies of scale and explain why they might arise. Define
Charging $17.99 a month for an unlimited number of
It was shown earlier in the chapter that Northland Industries was suffering
Which of the following is NOT an example of an entry barrier
