Saturday, September 8, 2018

ECONOMIES OF SCOPE

ECONOMIES OF SCOPE :

I want to consider AIRBUS  which manufactures aerospace products, commercial fights, cargo flights and helicopters with one kind of machinery. They have a common inputs of production in a large scale. When a industry want to reach a standards in field they have to make a best production. They manufacture all these in one kind of machinery at a time to maintain the best output. It automatically leads to cost saving. Here they use the same raw material to produce all these goods. The input is same for all goods for production process. But the output is different. In the same way many companies producing different kind of goods from one insustry. 

we can even take a lecture who teach mathematics in college and also run tutorial on his own for more income by explaining same subject.
we can consider it as Economies  of scope


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