Question

A statewide alliance of independent hospitals has formed in order to do group purchasing of medical supplies. Group purchasing allows the hospital alliance to negotiate lower prices with suppliers because of the large quantity of materials ordered. This is an example of the advantage of __________ resulting from an alliance.a. explicit collusion

b. economies of scale
c. opportunistic behavior
d. distribution opportunities

Answer 1

B) economies of scale

Step-by-step explanation:

Economies of scale refers to a proportionate saving in costs by increasing ether production output or input purchases.

In this case, the hospitals are saving money because they are buying supplies in bulk. The same applies to most purchases, for example, your school's teams need new jerseys. If the school decides to buy them all together at once they will probably get a discount for large volumes. it would be much more expensive if each team member had to buy his/her own jersey separately.