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A-LevelEconomicsFirms and Production / Economies and Diseconomies of ScaleOct/Nov 2019Paper 3 Q121 Mark

What would explain an increase in the size of an industry and a fall in the average output of the firms in an industry? A an advance in communication methods which reduce coordination problems within firms B an advance in technology which increases the cost advantage of capital-intensive methods of production C an increase in barriers to entry into the industry combined with an increase in barriers to exit from the industry D an increase in external economies of scale combined with a decrease in internal economies of scale

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About This A-Level Economics Question

This structured question appeared in the Cambridge A-Level Economics (9708) Oct/Nov 2019 examination, Paper 3 Variant 3. It tests the topic of Firms and Production / Economies and Diseconomies of Scale and is worth 1 mark.

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