Attempts: Average:12 3. Economies of Scale Aa Aa Which of the following is an ex
ID: 1123384 • Letter: A
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Attempts: Average:12 3. Economies of Scale Aa Aa Which of the following is an example of economies of scale? A firm grows in size and is now able to lower its health insurance costs because as the size of the insured group increases, the premium per person decreases substantially. To attract firms to locate in its state, the state government reduced the tax rate that businesses must pay on their profits, hence lowering the costs to firms who locate in the state. O As the computer industry has expanded, the number of professionally trained computer programmers has also increased, leading to an increase in the salaries of computer programmers. All economies of scale are achieved at the minimum of Flash Player MAC 27,0,0,187 Q3 3.34.1 © 2004-2016 Aplia. All rights reserved. © 2013 Cengage Learning except as noted. All rights reserved. Grade It Now Save & Continue Continue without savingExplanation / Answer
Answer-To attract firms to locate in its state, the state government reduced the tax rate that businesses must pay on their profits, hence lowering the costs to firms who locate in the state.
All economies of scale are achieved at the minimum of avarege costs
We know that the economies of scale means that the cost advantage that arises with increased production. The economies of scale arises because of the inverse relationship between the the cost and output. That means the greater the production then lower the cost.
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