Advanced Competitive Strategy | Online Course Support

Which of the following factors influence decision making on horizontal firm boundaries?

 
 
 

This is true. The benefits of learning economies can also significantly determine the size of a company (If learning economies are high a firm tends to be bigger).

 
 

This is correct. Economies of scope determine the horizontal firm boundaries of a firm (if a firm produces a large portfolio of products and some parts can be used in several products. This then can lead to lower input purchasing costs which makes producing more variants more attractive).

 
 
 
 

This is true. Larger firms can in some cases achieve economies of scale (e.g. the production costs of a good decreases when the produced amount is very high).

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