Diseconomies of Scale, Diseconomies of Scale : The diseconomies are the drawbacks

Diseconomies of Scale

Diseconomies of Scale:

The diseconomies are the drawbacks occurring to a firm or a group of firms due to big scale production.

Internal Diseconomies of Scale:

When a firm continues to grow and develops beyond the optimum capacity, the economies of scale fade away and diseconomies will begin operating. For illustration, when the size of a firm rises, after a point the difficulty of management occurs to that specific firm that will raise the average cost of production of that firm. This is termed as internal diseconomies of scale.

External Diseconomies of Scale:

Beyond a certain phase, too much localization and concentration of industries will generate diseconomies in production that will be common for all firms in a locality. For illustration, the expansion of an industry in a particular region leads to high rents and costs. These are the external diseconomies as this affects all the firms in the industry situated in that specific area

View Complete Question

Related Questions in Microeconomics

Q : Definition of Economic Profit To assert

To assert that a firm made exactly zero economic profits as well signifies that it made: (i) Zero accounting profits. (ii) Normal economic profits. (iii) Negative accounting profits. (iv) No profits at all. Choose the right answer

Q : Asset demand Select the right answer of

Select the right answer of the question. The asset demand for money: A) is unrelated to both the interest rate and the level of GDP. B) varies inversely with the rate of interest. C) varies inversely with the level of real GDP. D) varies directly with the level of nom

Q : Critics of the simple limit pricing

Critics of the straightforward limit pricing strategy argue about that: (w) sunk costs are not important in deterring entry. (x) for limit pricing to work, there should be a credible threat to keep old output levels. (y) this is rational to expect the

Q : Decrease the burden of sales tax on low

To decrease the burden of a sales tax upon low income households, in that case: (i) goods along with high income elasticities should be taxed. (ii) goods along with low income elasticities should be taxed. (iii) goods along with high income elasticities must be exempt

Q : Claimants to a firms income stream The

The least probable of the given to be claimants to the firm’s income stream would be the firm’s: (1) Shareholders. (2) Managers. (3) Customers. (4) Suppliers. (5) Government. Can someone please help me in finding out th

Q : Equilibrium price of commodity Describe

Describe why the equilibrium price of commodity is determined at the level of output at which its demand equavalents its supply.

Q : Define balance of trade Balance of

Balance of trade: It is the distinction between imports and exports of a country which are valued.

Q : Question related to Gross domestic

Proprietors' income $ 20, Compensation of employees 300, Consumption of fixed capital 15, Gross investment 80, Rents 10, Interest 20 ,Exports 30, Imports 50, Corporate profits 25, Taxes on production and imports 5 ,Net foreign factor income 0 ,Statistical discrepancy

Q : Profit-maximizing level of output When

When LoCalLoCarbo, the favorite corporation of fad dieters, produces adequate output to minimize its average total costs that will: (1) produce more than the profit-maximizing level of output. (2) concurrently minimize its average variable cost. (3) p

Q : Analytic time in market structure In

In this figure the firm probably to go out of business the soonest would be as: (w) Firm A. (x) Firm B. (y) Firm C. (z) Firm D. 298_Market Str</span></p>
</div>

</li>

</td>
</tr>
</table>

</ul>

</div>
</div>
<div class=

Discover Q & A

Leading Solution Library

Avail More Than 1452819 Solved problems, classrooms assignments, textbook's solutions, for quick Downloads

No hassle, Instant Access

Start Discovering

18,76,764

1933104
Asked

3,689

Active Tutors

1452819

Questions
Answered

Start Excelling in your courses, Ask an Expert and get answers for your homework and assignments!!

Submit Assignment