Question

A cooperative buying group is an example of ____________.

• A. a factor leading to internal economies of scale
• B. a factor leading to external economies of scale
• C. both A and B
• D. none of the above

Answer 1

The correct option is A a factor leading to internal economies of scale

A cooperative buying group is likely to experience internal economies of scale as they will have negotiating power with the sellers and will be able to obtain a preferential trade agreement. They are most likely to experience purchasing economies of scale.