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  • Anforme What are economies of scale and how do they reduce firms' costs?

Anforme What are economies of scale and how do they reduce firms' costs?

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Simon Harrison of d’Overbroeck’s, Oxford, illustrates potential sources of lower cost per unit.

 

Summary of Key Points:

  • Internal economies of scale arise from technical, financial, purchasing and marketing reasons and mean lower costs per unit for a firm.
  • External economies mean lower unit costs for more than one firm within an industry.

This article is from ET Volume 14 Issue 3.

Simon Harrison of d’Overbroeck’s, Oxford, illustrates potential sources of lower cost per unit.

 

Summary of Key Points:

  • Internal economies of scale arise from technical, financial, purchasing and marketing reasons and mean lower costs per unit for a firm.
  • External economies mean lower unit costs for more than one firm within an industry.

This article is from ET Volume 14 Issue 3.

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