the scale of output that a production facility must operate at to realize all major plant-level scale economies is called the

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05-12-2022
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contexto115 contexto115 · Answer 1 · 2022-12-07T11:22:09-05:00

The scale of output that a production facility must operate at to realize all major plant-level scale economies is called the minimum efficient scale.

The minimum efficient scale (MES) is the lowest point on a cost curve at which a company can produce its product at a competitive price. At the MES point, the company can achieve the economies of scale necessary for it to compete effectively in its industry.

The minimum efficient scale (MES) is the balance point at which a company can produce goods at a competitive price. The MES is the point on a company's long-run average cost curve where economies of scale have been exhausted, and constant returns have begun. Many factors go into the MES, and each can change with time, forcing a reevaluation of overall costs.

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