Economies of scale refers to cost savings from leveraging core competencies or sharing related activities among businesses in a corporation. True False

Economies of scale refers to cost savings from leveraging core competencies or sharing related activities among businesses in a corporation.
True
False

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Answer

• False
  Explanation:
  The above description is for economies of scope which is different from economies of scale. Economies of scope arises as a result of cost savings from leveraging core competencies or sharing related activities among business in the corporation. This is attributed to

• favorable reputation,
• reusing key resources,
• management skills and efficient purchasing among others.