Internal Economies and Diseconomies are dependent on _______________.

Output level of individual Firms

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Output level of the entire industry

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Both (a) and (b)

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Neither (a) nor (b)

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Solution

The correct option is B Output level of individual Firms
Internal Economies and Diseconomies are dependent on output level of individual firms. Internal Economies and Diseconomies in operations depend on the internal factors within the firm.
Internal Economies or diseconomies can be defined as a situation when the production of the firm gets affected because of the internal factors of the firm only.
Hence, option A is correct.

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