Answer to Question #54927 in Microeconomics for see yin yee
Why do you think the motorcar production exhibits economies of scale but not the trucking (haulage) industry?
In the motorcar production fixed costs take a large part of total costs. So if we produce more motorcars the same amount of fixed costs is divided by more quantity of production units. As a result cost of one motorcar production becomes less, comparing to cost of previous unit production. In trucking industry opposite situation in cost sharing - variable costs take the main part of total costs. So economies of scale effect is almost absent here.
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