If a refinery achieves a reduction in cost by purchasing and transporting crude oil in large quantities, it enjoys
-
economies of scale
- specialization
- division of labour
- diseconomies of scale
The correct answer is: A
Explanation
Economies of scale is a proportionate saving in costs gained by an increased level of production. This means that, a firm begin to enjoy certain benefits such as a reduction in its direct and overhead cost as its scale of transaction and operation expands.