THREE PAGES NEEDED ANSWERING THE QUESTIONS BELOW FROM THE READING(ATTACHED): Sysco Feasts on Economies of Scale for Strong Competitive Advantage as well as Chapter 9 NOTES (ATTACHED) Based on this...

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THREE PAGES NEEDED ANSWERING THE QUESTIONS BELOW FROM THE READING(ATTACHED): Sysco Feasts on Economies of Scale for Strong Competitive Advantage as well as Chapter 9 NOTES (ATTACHED)
Based on this information, respond to the following:
Describe economies of scale and diseconomies of scale.
What are the determinants of economies of scale and diseconomies of scale, respectively?
Using a real-world company (other than Sysco), explain the causes of economies of scale for your company.
Explain how economies of scale help your company compete in its industry.
Explain how universities might experience diseconomies of scale.
Answered Same DayApr 06, 2022

Solution

Komalavalli answered on Apr 07 2022
14 Votes
Economics of scale (EoS)
Cost benefits that organizations enjoy when production becomes more efficient are refe
ed to as economies of scale. Businesses can attain economies of scale by expanding output while decreasing expenses. This occurs because costs are dispersed among a greater number of commodities. Fixed and variable costs are both possible.
When it comes to economies of scale, firm size is frequently crucial. Higher the company's size the larger the cost savings. Scale economies can be both internal and external. Extrinsic economies are concerned with external forces, whereas intrinsic economies are focused with managerial decisions. Accounting, information technology, and marketing are examples of internal functions. The first two are also refe
ed to as performance and synergy. The benefits of mergers and acquisitions are the second and third arguments given.
Diseconomies of scale:
Disparities in size occur when a company or business becomes so large that the cost per unit increases. It occurs when economies of scale no longer work for a business. With this principle, instead of continuously reducing costs and increasing output, a company finds costs increase as output increases. Scale inequality, in instance, happens for a variety of causes, all of which may be roughly characterized as internal or external. Internal scale uncertainty can occur as a result of technological issues in production or organizational issues in the structure of a firm or industry.
Determinants of economics and diseconomies of scale:
Technical factor: It is related with large-scale production. When a corporation expands its operations, it must utilize more specialized and efficient equipment and technology. These machines may provide higher outputs at reduced unit costs. Furthermore, when the size of production grows, as does the number of workers and other elements, the corporation manages to minimize costs by instituting some degree of division of labor and specialization. However, beyond a certain threshold, the firm suffers from a scale disadvantage. This occurs because, once a sufficiently significant level of output is attained, the firm employs practically every possible method of dividing labor and utilizing machinery efficiently. Following that, each increase in plant size results in a rise in expenses. When the size of...
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