JAMB Economics 1984 Question 9

Question 9

Theory of Production

One of the advantages of large-scale production is that

  1. A.there is a rise in the cost of administration
  2. B.consumers sacrifice their individual tastes
  3. C.the firm can use labour-saving machinery
  4. D.the demand for a firm's products becomes localized
  5. E.decision making takes a long time because different levels of management are involved.
Show the answer and explanation

Answer: C (the firm can use labour-saving machinery)

Explanation

A large firm can afford expensive labour-saving machines, lowering its unit costs; the other options are disadvantages.