Economies of scale refer to the cost advantages that businesses experience as they increase their production levels. This fundamental concept in economics illustrates how larger firms can reduce their per-unit costs through more efficient use of resources, enhanced production techniques, and improved bargaining power with suppliers.

Economies of scale refer to the cost advantages that businesses experience as they increase their production levels. This fundamental concept in economics illustrates how larger firms can reduce their per-unit costs through more efficient use of resources, enhanced production techniques, and improved bargaining power with suppliers.