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Economies of scale imply that within some range, a firm can increase the size of its operation and
a. Fixed costs will decrease
b. Average total costs will increase
c. Average total cost will decrease
d. Total costs will decrease

Answer :

Economies of scale imply that within some range one can increase the size of operation and average total cost will decrease.

Economies of scale are cost advantages that businesses enjoy as a result of efficient production. In order to attain economies of scale, businesses must increase production while reducing expenses. Costs are distributed among a greater variety of commodities, which is why this occurs. Both fixed and variable costs are possible.

Both internal and external economies of scale are possible. Forces within a single firm are what lead to internal economies, while external factors have an impact on the entire sector.

Economies of scale are a crucial concept for any company, regardless of industry, and they stand for the cost savings and competitive advantages larger companies have over smaller ones.

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