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Types of economies of scale
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Types of economies of scale
12
Types of economies of scale
Technical
large capital equipment with high fixed costs
Specialisation
Divisiiion of labour and specialisation within production - moe efficient with high output
Bulk buying
Lower average costs for buying large quantity
Martketing
National ad campaign more efficient for high sales
Risk bearing
Bigger firms more able to survive downturns
Container principle
Increase in surface area leads to double the increase in volume
Financial
Larger firm gets better rate of interest from bank
External
When a firm benefits from the whole industry increasing in size
https://www.economicshelp.org/blog/326/concepts/economies-of-scale-examples/
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This work was published by MindMaster user Mind Trainer and does not represent the position of Edraw Software.
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