OxNotes > GCSE Economics Notes > Economies of Scale

---

Economies of scale

There are benefits and drawbacks in increasing the size of operation of a business. The cost advantage is known as economies of scale. The cost disadvantage is known as diseconomies of scale.

---

The benefits of large-scale business

Economies of scale are the cost advantage from business expansion. As some firms grow in size their unit costs begin to fall because of:

Mass production in the Volkswagen factory - an example of Economies of Scale.

---

Back to GCSE Economics

---

---

---

---

---