SMALL & LARGE FIRMS
Hey Everyone, Lovely New Week even though its ended but um
its beautiful today isn't it. FRIDAY!!!.
LOLZ- Its very self-explanatory.... Okay let's work a lil before we throw
our books to the other side *winks*.
A Firm is defined as an independently administered businesses
unit which is capable of carrying out production, construction or distribution
activities. It forms an industry with other firms performing or producing
complementary goods and services. Firms may be small or large depending on
capital outlay and the level of production.
CHARACTERISTICS OF SMALL & LARGE FIRMS:
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Characteristics
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Small Firms
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Large Firms
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1. Capital Requirement
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Require Small Capital Outlay.
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Require Large Capital Outlay.
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2. Type of Industry
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They are mainly involved in primary production, agriculture
and some direct services.
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They are mainly involved in secondary and tertiary
production.
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3. Nature of Market
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They require small market due to output of goods.
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They require a large market because of their high output of
goods.
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4. Employment
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They usually employ few workers.
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They usually employ large number of workers.
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5. Techniques of Production
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They employ simple techniques as most of the operations are
manual.
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They employ heavy techniques, with machinery and equipment.
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6. Economies of Scale
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They cannot take advantage of economies of scale.
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They can easily benefit from internal and external
economies of scale.
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7. Nature of Product
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They have no special or standard design for their product.
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Their product is subject to standardisation.
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8. Research and Publicity
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They may lack the resources to carry out research and
publicity.
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They usually embark on extensive research and publicity to
enhance their efficiency.
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ECONOMIES
OF SCALE/ SCALE OF PRODUCTION
Economies of Scale can be defined as the growth of a firm as
a result of the expansion of the volume of productive capacity resulting in the
increase in output and a decrease in its caot of production per
