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Burley Spuds Inc. turns potatoes into ready-to-cook french fries. Burley's production facility initially operated for one daytime shift. Management decides to add an evening shift
Burley Spuds Inc. turns potatoes into ready-to-cook french fries. Burley's production facility initially operated for one daytime shift. Management decides to add an evening shift in order to use the facility to produce ready-to-cook tater tots. Using the facility in the evening allows Burley to produce tater tots at a lower average cost than that of its competitors. This is an example of: Constant returns to scale Economies of scope Increasing returns to scale Decreasing returns to scale
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