Two firms, each producing different goods, can achieve a greater output than one firm producing both goods with the same inputs. We can conclude that the production process involves:

A) diseconomies of scope.
B) economies of scale.
C) decreasing returns to scale.
D) increasing returns to scale.

Question

Athenkosi Mjekula · Accepted Answer

Final Answer : A, Explanation :  Diseconomies of scope occur when it's less efficient for a firm to produce multiple products together than to produce them separately, which aligns with the scenario described.

Two firms, each producing different goods, can achieve a greater output than one firm producing both goods with the same inputs. We can conclude that the production process involves:

A) diseconomies of scope.
B) economies of scale.
C) decreasing returns to scale.
D) increasing returns to scale.

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Learning Objectives

Related questions

Two firms, each producing different goods, can achieve a greater output than one firm producing both goods with the same inputs. We can conclude that the production process involves:A) diseconomies of scope.B) economies of scale.C) decreasing returns to scale.D) increasing returns to scale.

Definitions

Learning Objectives

Learning Objectives

Related questions

Two firms, each producing different goods, can achieve a greater output than one firm producing both goods with the same inputs. We can conclude that the production process involves:

A) diseconomies of scope.
B) economies of scale.
C) decreasing returns to scale.
D) increasing returns to scale.