Question

After sugar refiner has produced fine sugar for baking purposes, what is left over is used to produce molasses. This technology exhibits a. ​Economies of scale b. ​Diseconomies of scale c. ​Diseconomies of scope d. ​Economies of scope

Answer 1

ECONOMIES OF SCOPE

Step-by-step explanation:

Economies of Scope concept implies producing different , but related products will reduce the per unit cost of production of the firm (relatively lesser than if the products would have been produced separately.

This happens because of backward & forward linkages in interrelated but different goods' inputs & outputs .

Ex : In this case, another byproduct - molasses has been produced of waste from sugar production, which could have otherwise been purchased input.

Economies of Production is cost reduction due to quantity & not variety production. Diseconomies of Scale & Diseconomies of Scope are their opposite phenomenas leading to cost rise . So , none of these 3 are apt.