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Concentrating industries in one place is advantageous because there are gains in...


Question

Concentrating industries in one place is advantageous because there are gains in terms of_____________

Options

A) cost economies

B) economies of scale

C) internal economies

D) external economies

The correct answer is D.

Explanation:

External economies of scale are economies of scale which a firm enjoys by virtue of being in an industry or environment where for instance, similar firms are located, as this question asks about. They are still economies of scale though, so technically B could also be correct. This is one of those tricky questions.

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Discussion (2)

  • External economies of scale are economies of scale which a firm enjoys by virtue of being in an industry or environment where for instance, similar firms are located, as this question asks about. They are still economies of scale though, so technically B could also be correct. This is one of those tricky questions.

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  • External Economics pls

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