Answered

Generally, as a movie theater adds more screens its average costs fall. The movie theater can
said to experience
Select one:
O a. economies of scale
Ob. diminishing marginal returns
O c. declining profit
Od. diseconomies of scale
Oe. higher prices



Answer :

GinnyAnswer

Final answer:

Movie theater benefiting from economies of scale by lowering average costs as it adds more screens.


Explanation:

Economies of scale occur when a movie theater experiences a decrease in average costs as it adds more screens. This situation arises when an increase in output leads to a reduction in average costs in the long run.

For example, the movie theater might benefit from bulk purchasing discounts on films or concessions, spreading fixed costs over a larger number of screens, and optimizing staff efficiency.

Therefore, in this scenario, the movie theater can be said to be experiencing economies of scale as it expands and benefits from cost efficiencies.


Learn more about Economies of scale here:

https://brainly.com/question/31601710


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