Question

London Simpson owns a company that makes smartphone accessories. She is trying to increase her sales, primarily because she knows that increasing production lowers the average cost of each unit produced.

The reason for growth illustrated in this example is ________.

A) economies of scope
B) market leadership
C) influence, power, and survivability
D) need to accommodate the growth of key customers
E) economies of scale

Answer 1

E) economies of scale

Step-by-step explanation:

Based on the information provided within the question it can be said that the reason for growth illustrated in this example is economies of scale. This is basically a cost advantage that company's gain as they have large amounts of production, since costs per unit decreases as the company's level of production increases. Which is why London Simpson wants to increase her sales, because if she increases sales she needs to produce more, which ultimately saves her money since price per unit decreases.