Presentation Transcript Economic & Diseconomies scale of m.s.r.t.c : Economic & dis economies scale of m.s.r.t.

c By ANIKET- 01 SACHIN - 05 GUIDED BY - PROF MADAN SIR Economies of scale : Economies of scale Economies of scale :- Refers to the cost of advantages that a business obtains due to expansion. "Economies of scale" is a long run concept and refers to reductions in unit cost as the size of a facility and the usage levels of other inputs increase Slide 3: There are factors that cause a producers average cost per unit to fall as the scale of output is increased. As quantity of production increases from Q to Q2, the average cost of each unit decreases from C to C1. LRAC-Long Run Avg. Cost Slide 4: Economies of scale is a practical concept that is important for explaining real world phenomena such as patterns of international trade, the number of firms in a market, and how firms get "too big to fail". The exploitation of economies of scale helps explain why companies grow large in some industries and Sectors. Slide 5: Types of economies of scale: Internal Economies. External Economies. 1. Internal Economies: The term refers to those advantages which are enjoyed by an individual firm as an industry. For example- RCF company, The manager employ and all inside plant & company is getting advantage of it Slide 6: Internal economies enjoyed by an individual firm can be discussed under different categories as follows: 1. Technical Economies. 2. Managerial economies. 3. Marketing economies. 4. Financial economies. 5. Risk bearing economies. Internal economies enjoyed by an individual firm can be discussed under different categories as follows: 1. Technical Economies. 2. Managerial economies. 3. Marketing economies. 4. Financial economies. Slide 7: 2. External Economies:- As a result of growth of a particular industry may benefits are shared by all the firms. There are certain advantages which are enjoyed by all firms in an industry, this term is called external economies. Economies of Concentration Economies of Information Economies of Disintegration Economies of Large-scale production For example- The Passengers, Baggers, ST Canteen, people who sales food at stop, etc. MSRTC : MSRTC M.S.R.T.C The Economies scale Of MSRTC As per following Slide 9:

Internal Economies of M.S.R.T.C As the total number of customer increases the Company enjoy many benefits, such as increase in Profit, which in return benefits: Driver , Conductor, Employees, other subsidiary companies MSRTC : MSRTC 1. Technical Economies:- The economies are result of using better techniques of production facilitated by growth of the firm. it consist of online reservation, air Conditional system(SHIVNERI BUS). 2. Managerial Economies:- They appoint Several trained experts as managers of different department like depot manager, manager, Maintenance department . Slide 11: 3. Financial Economies:- MSRTC Firm is the largest firm so they form large capital by the fairs of passenger. They have a large passenger support also they enjoy the funds from government, and this enables them to manage the finance in more efficient and more balanced way. 4.Marketing Economies:- MSRTC offers various types of passes for 4 days,10 days ,senior citizen & physical handicap reservation. Because of that people give the preference to the ST buses . Secondly they make provision or observe the passengers because of that finally they establish the network e.g. during mahashivratri , extra buses from PUNE to BHIMASHANKAR. Slide 12: External Economies:- As firm earn profit, a number of benefits are also earn by the outsider, such as: 1. Revenue to government through Tax 2.Employment to food seller 3.Income to canteen owner 4.Income to Subsidiary firms such as body maker etc Slide 13: when the firm expands and becomes difficult to manage than diseconomies of scale arises. In large scale organizations increased production may cause certain diseconomies and disadvantages. In the firms course of expansion, a stage may reach when the firm becomes too large to manage. It may face several problems just because its size has become very large. DIS-ECONOMIES OF SCALE:Internal diseconomies of scale : Internal diseconomies of scale A firm find it difficult to manage during peak season as the summer vacation, govt. holiday, Diwali and visitors increases. And also there is shortage of buses and employees. Some times the staff also suffers, physically as well as mentally. External dis-economies of scale:- : MSRTC has captured mostly market of travel companies, hence many travel companies come in difficult to even survive. MSRTC stars the full AC buses in low charge, hence the profit ratio of competing travel companies keep on decreasing. External dis-economies of scale:Slide 16: References :- Lonavla Bus stop Text book of Managerial Economics ns??? Thanks