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The main advantage of economies of scale is that a business can achieve A - HSC - SSCE Business Studies - Question 6 - 2020 - Paper 1
Question 6
The main advantage of economies of scale is that a business can achieve A. economic objectives. B. industry benchmarks. C. lower per unit input costs. D. simplified... show full transcript
Worked Solution & Example Answer:The main advantage of economies of scale is that a business can achieve A - HSC - SSCE Business Studies - Question 6 - 2020 - Paper 1
Step 1
Identify the main advantage of economies of scale.
Answer
The primary advantage of economies of scale is that businesses can reduce their per unit input costs. This occurs because, as the production volume increases, the fixed costs associated with production (like factories and machinery) are spread over more units, which lowers the overall cost for each unit produced. Therefore, the correct answer is:
C. lower per unit input costs.