1.5

Question 1

what is economies of scale?

Answer 1

enable business to benefit from lower average costs (the cost per unit) by increasing the size of its operations

Question 2

what is diseconomies of scale?

Answer 2

occur when the business grow beyond its ability
firm’s average costs of production increase

Question 3

optimal output level

Answer 3

level of output where the average cost of production is at its lowest value (average cost paling murah utnuk pengeluaran)
maximum profit

average cost= total cost/quantity produced

total cost of production include fixed costs and variable costs

kalau business dapat kekalkan fixed costs untuk high production, dia akan dapat economies of scale

Question 4

internal econmies of scale

Answer 4

financial ecoomies of scale-banks and lenders charge lower interest to larger business for loans because the have low risks, vice versa

marketing economies of scale-larger business spread their fixed costs of marketing by promoting a greater range of products/brands

Question 5

managerial economies of scale

Answer 5

large businesses hire specialist managers, thus improving the business productivity

Question 6

technical economies of scale

Answer 6

cost savings by using large scale mechanical processes and specialist machinery

Question 7

purchasing economies of scale

Answer 7

large business can benefit from cost savings by buying stocks (raw materials, finished good) in bulk