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Q. What is Internal Diseconomies of Scale?
Internal economies of scale exist only up to a certain size of the plant. Size of plant is called the optimum plant size since with this size of plant all possible economies of scale would be fully exploited. If the size of plant increases beyond this optimum size there arise diseconomies of scale (which implies decreasing returns to scale) especially from managerial diseconomies. It is claimed that technical diseconomies can be avoided by duplicating the optimum technical size of the plant.
The aim of monopolist is to maximise profit therefore; he would produce that level of output and charge that price which gives him maximum profits. He would be in equilibrium at th
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Define Williamson''s Model of Managerial Discretion practice?
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