External economies are factors beyond the control of an individual firm that as the total industry o...........

External economies are factors beyond the control of an individual firm that ________ as the total industry output increases.

raise its marginal revenue

raise its costs

lower its costs

lower its profit

- External economies refer to factors outside the control of a single firm that can affect its production costs or efficiency as the industry grows.

- Option 1: Raise its marginal revenue

- When the industry expands, it doesn't necessarily increase an individual firm's marginal revenue.

- Option 2: Raise its costs

- External economies generally help reduce costs, not raise them.

- Option 3: Lower its costs

- As the industry output grows, factors like shared infrastructure and specialized suppliers typically lower costs.

- Option 4: Lower its profit

- Reduced costs from external economies usually enhance profits, not lower them.

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