# Corporate growth

- Canonical URL: https://www.gerhardmerk.de/corporate-growth-2
- Post ID: 594162
- Modified: 2023-07-25T21:00:33+00:00
- Language: en

## Definition

Related to the operation of a bank in the As a rule, there is an increase in sales. However, this only has a positive effect on profits if the additional costs incurred as a result of the growth are lower than the increase in sales, taking into account time and risk preferences. This in turn can be the case if existing and/or additional resources can be better utilized for existing directions of use (economics of scale: reduction in costs per unit resulting from increased production, realized through operational efficiencies) and/or for new directions of use (economics of scope: the reduction in costs per unit through the production of a broader variety of goods). - Experience has shown that the realization of such "economics" is often hindered by the fact that the coordination costs incurred in the growth process are too high and, as a rule, insufficiently planned for. - See assertion strategy, financial market, growth importance, Gibrat rule, Penrose theorem. Attention: The financial encyclopedia is protected by copyright and may only be used for private purposes without express consent! University Professor Dr. Gerhard Merk, Dipl.rer.pol., Dipl.rer.oec. Professor Dr. Eckehard Krah, Dipl.rer.pol. E-mail address: info@ekrah.com https://de.wikipedia.org/wiki/Gerhard_Ernst_Merk https://www.jung-stilling-gesellschaft.de/merk/ https://www.gerhardmerk.de/

## Machine-readable

- Generator: Merk Knowledge 1.1.1