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- DictionaryEconomy of scope
- ▪ a proportionate saving gained by producing two or more distinct goods, when the cost of doing so is less than that of producing each separately
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Aug 20, 2023 · Economies of scope focus on the average total cost of production of a variety of goods. In contrast, economies of scale focus on the cost advantage that arises when there...
Jan 31, 2017 · Economies of scope occur when a firm can gain efficiencies from producing a wider variety of products. These efficiencies can involve lower average costs. It can also involve increased revenue from being able to increase sales in new, related markets. It is similar to concept of economies of scale – where higher output leads to lower average costs.
Mar 28, 2024 · Summary: Economies of scope refer to the cost-saving benefits achieved when a company produces a variety of goods or services together, reducing the overall cost of production. Unlike economies of scale, which focus on volume, economies of scope emphasize the efficiency gained through the simultaneous production of diverse products.
Nov 21, 2023 · The economy is partly defined as saving costs or the efficient allocation of capital, and scope refers to a broad focus. It is traditionally accepted that the production of a single...
Jun 21, 2019 · Economies of scope represent the production efficiency which enables a firm to produce more than one products at a cost which is lower than the sum of stand-alone costs of each product.
Sep 29, 2020 · Economies of scope is a term that refers to the reduction of per-unit costs through the production of a wider variety of goods or services. Example of Economies of Scope. Let's assume Company XYZ strictly manufactures vacuum cleaners. What would happen if the company decided to branch out into brooms?
noun [ plural ] ECONOMICS, PRODUCTION uk us. Add to word list. the reduction of costs that is the result of sharing resources, processes, and skills in producing a larger range of products: Economies of scope only benefit companies who are also willing to manage the risk of added complexity.
