Economies of scope focuses on the average total cost of production of a variety of goods whereas economies of scale focuses on the cost advantage that arises when there is a higher level of . Economics the term and the concepts development are attributed to economists john c panzar and robert d willig 1977 1981 whereas economies of scale for a firm involve reductions in the average cost cost per unit arising from increasing the scale of production for a single product type economies of scope involve lowering average cost by producing more types of products. Economies of scale vs economies of scope differences economies of scale and economies of scope are both concepts of economics and they both are very useful to a business that wants to grow and serves its customers better. Economies of scale and scope definition economies of scale refers to the phenomenon where the average costs per unit of output decrease with the increase in the scale or magnitude of the output being produced by a firm. Economies of scope first cousins to economies of scale are economies of scope factors that make it cheaper to produce a range of products together than to produce each one of them on its own
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