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Suppose One Firm Buys Cattle to Process Only the Skins

Question 118

Multiple Choice

Suppose one firm buys cattle to process only the skins for leather, and another firm buys cattle to process only the meat for food. If the two firms merged, they would experience


A) increasing returns.
B) economies of scale.
C) economies of scope.
D) increasing marginal product.
E) decreasing marginal cost.

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