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1.4 Production, costs, revenue and profit

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Question 6

A chain of veterinary practices expands and treats more animals each year.

Which change is an example of managerial economies of scale?

[1]
A

It installs specialised diagnostic equipment that processes tests at lower unit cost.

B

It borrows for new premises at a lower rate of interest.

C

It negotiates a lower price by ordering medicines in larger quantities.

D

It employs a specialist operations manager who reduces wasted staff time.

Markscheme

1.4 Production, costs, revenue and profit Questions

  1. GCSE
  2. /Economics
  3. /1.4 Production, costs, revenue and profit

138 exam-style questions on AQA GCSE Economics 1.4 Production, costs, revenue and profit, covering 1.4.1a Business objectives, 1.4.1b Types of costs and revenue, 1.4.1c Calculating profit, 1.4.1d Profit as an incentive to produce, 1.4.1e Moral and ethical considerations, 1.4.2a Production versus productivity, 1.4.2b Factors and benefits of productivity, 1.4.3a Economies of scale and business behaviour, 1.4.3b Types of economy of scale, and 1.4.3c Diseconomies of scale. Each one has a worked solution and a mark scheme showing where the marks go.

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