Chapter 31 – Economies of scale

Economies of scale are the cost advantages reaped by companies due to efficient production They can be achieved by production increases, which seems

Economies of scale refer to the notion that average cost falls as the firm expands Conversely, diseconomies of scale occur when expansion incurs increasing

ak1688 office This fall in average costs as output increases indicates that a business is benefitting from economies of scale This reduction in average costs is what gives

economy of scale In economies of scale, businesses can lower the average cost of production by making more of a product