GK
BUSINESS ECONOMICS
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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Large business are usually able to negotiate lower repayments on loans. What economy of scale is this?
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Financial
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Marketing
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Managerial
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Purchasing
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Explanation:
Detailed explanation-1: -Economies of Scale Definition Economies of scale are cost savings that a company (and, by default, its customers) can reap as a result of efficient production processes. Generally, these cost savings are achieved because the average cost of producing something falls as the volume being produced increases.
Detailed explanation-2: -A large retail store can buy in bulk and lower its cost per unit. It can then choose to keep the savings to increase the business’ profits or use them as a competitive advantage by passing the savings on to the consumer and offering lower prices than its competitors.
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