uplearn: business growth

Question 1

whats the internal economies of scale acronym to remember?

Answer 1

richards - risk bearing
mum - marketing
flies - financial
past - purchasing
the - technical
moon - managerial

Question 2

whats the internal diseconomies of scale acronym to remember?

Answer 2

ABC
alienation
bureaucracy
communication

Question 3

explain the principle agent problem?

Answer 3

result of a divorce of ownership and control

principle = shareholders (own the company because greater shares than the agents)
agent = ceos managers

there is asymmetric information
agents may pursue different objectives instead of prioritising profit maximisation for the principle (shareholders)