viernes, 22 de abril de 2016

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Economies Of Scale
Economies of scale is the cost advantage that arises with increased output of a product. Economies of scale arise because of the inverse relationship between the quantity produced and per-unit fixed costs; i.e. the greater the quantity of a good produced, the lower the per-unit fixed cost because these costs are spread out over a larger number of goods. Economies of scale may also reduce variable costs per unit because of operational efficiencies and synergies. Economies of scale can be classified into two main types: Internal – arising from within the company; and External – arising from extraneous factors such as industry size.
Breaking It Down:
“Economies of scale” is a simple concept that can be demonstrated through an example. Assume you are a small business owner and are considering...
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