Asked by
Sherry Sutton
on Nov 25, 2024
Verified
When a firm does more of something, it gets better at it. This learning-by-doing is
A) a source of diseconomies of scale.
B) a source of economies of scale.
C) called the principle of natural progression.
D) called "spreading the overhead."
Economies of Scale
Cost advantages reaped by companies when production becomes efficient, leading to a decrease in cost per unit as output increases.
Learning-by-doing
An economic concept that suggests productivity and efficiency improve through practice and the accumulation of experience.
Spreading the Overhead
The practice of distributing fixed costs over a variety of products, projects, or business units to ensure efficiency and reduce the overall cost per unit.
- Clarify the impact of technological progress on the costs associated with production.
- Determine the circumstances where a natural monopoly emerges and understand the impact of learning on decreasing costs progressively.
Verified Answer
MP
Learning Objectives
- Clarify the impact of technological progress on the costs associated with production.
- Determine the circumstances where a natural monopoly emerges and understand the impact of learning on decreasing costs progressively.