The larger the diameter of a natural gas pipeline, the lower is the average total cost oftransmitting 1,000 cubic feet of gas 1,000 miles. This is an example of:

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Question:

The larger the diameter of a natural gas pipeline, the lower is the average total cost oftransmitting 1,000 cubic feet of gas 1,000 miles. This is an example of:

A.

Economies of scale.

B.

Normative economies.

C.

Diminishing marginal returns.

D.

An increasing marginal product of labour.

Answer» a. Economies of scale.

Note: The above multiple-choice question is for all general and Competitive Exams in India.