Synergies arise when one or more of a diversified company's business units are able to lower costs because they can more effectively pool, share, and utilize expensive resources or capabilities. This is called:

Question

Christine Snow

Business

21 September, 20:09

Synergies arise when one or more of a diversified company's business units are able to lower costs because they can more effectively pool, share, and utilize expensive resources or capabilities. This is called:

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Answers (1)

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Alberto Baldwin · Answer 1

Economies of scope

Explanation:

Economies of scope -

The meaning of the term economies of scope is the reduction in the cost of a particular product due to the production of some similar product.

It refers to the situation where the marginal cost of the company or organization reduces, because of some production of the complimentary services or goods, is referred to as economics of scope.

Hence, from the given scenario of the question,

The correct answer is Economies of scope.