CFA Practice Question

There are 96 practice questions for this study session.

CFA Practice Question

If an industry enjoys economies of scale, its ______ tend to be positively correlated with its sales levels.

I. average cost.
II. gross margin.
III. operating margin.
Correct Answer: II and III

Gross and operating margins that are positively correlated with sales provide evidence of economies of scale in an industry.

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