A wide product variety makes it easier for a firm to increase its prod

QUESTION

A wide product variety makes it easier for a firm to increase its production efficiency and thus reduce its unit costs.

Indicate whether the statement is true or false.

ANSWER

FALSE
A wide product variety makes it difficult for a company to increase its production efficiency and thus reduce its unit costs. According to this logic, the way to increase efficiency and drive down unit costs is to limit product variety and produce a standardized product in large volumes.