JAMB Economics 2020 Objective — Question 21
Question 21 of 50 from the Joint Admissions and Matriculation Board (JAMB) Economics 2020 Objective paper, with the correct answer and a full explanation.
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If a refinery achieves a reduction in cost by purchasing and transporting crude oil in large quantities, it enjoys
- A. economies of scaleCorrect
- B. specialization
- C. division of labour
- D. diseconomies of scale
Explanation
Buying and transporting crude oil in bulk lowers the unit cost - a classic case of economies of scale.
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