The rapid expansion of the e-commerce fulfillment sector in a regional transport corridor has led to severe congestion on the local road network and longer transit times. Consequently, all distribution firms operating in this area have experienced an increase in their average delivery costs.
This is an example of
an internal diseconomy of scale.
a managerial diseconomy of scale.
an external diseconomy of scale.
a financial diseconomy of scale.
156 exam-style questions on AQA A Level Economics 1.4 Production, costs and revenue, covering 1.4.1 Production and productivity, 1.4.2 Specialisation, division of labour and exchange, 1.4.3 The law of diminishing returns and returns to scale (A-level only), 1.4.4 Costs of production, 1.4.5 Economies and diseconomies of scale, 1.4.6 Marginal, average and total revenue, 1.4.7 Profit, and 1.4.8 Technological change (A-level only). Each one has a worked solution and a mark scheme showing where the marks go.