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Economics FROM 4 ART

CHAPTER 1 : ECONOMICS OF SCALE

SCALE OF PRODUCTION

The  size of production can be small, medium or large scale depending on the size of capital autorised or allowed. The N° of cookers or the size of the output.

Large firms have force reducing advantages known as economic of scale.

  • The plant refers to the actual place in which production takes place. It is a branch of a unit which the specific geographical location and output for e.g the mondonin oil mile.                                                                                                                                        It is the smallest unit of the scale of production.
  • Firm:  A firm is an independent business unit carries out then construction, production and distribution activities. A firm can contain more than 2 plants e.g Brasseries in Cameroon, Pamol etc.
  • Industry: This is a group of firms using similar role material and technology in the production of scale or similar goods and services e.g The brewery industry which is made up of firms such as Guiness CMR SA, Brasseries in CMR, UCB,Textile industry.
par Claude Foumtum