Topic 6: Economies of Scale, Imperfect Competition and Economic Geography

Question 1

Mutually beneficial trade can arise as a result of ……….. .. …….

• With trade, a country can take advantage of economies of scale to produce more efficiently than if it tried to produce everything for itself

Answer 1

economies of scale

Question 2

……….. economies of scale occur when cost per unit of output depends on the size of the industry

Answer 2

External

Question 3

………. economies of scaleoccur when the cost per unit of output depends on the size of a firm

Answer 3

Internal