This term refers to how a large volume of production reduces the cost of producing a single product:

Question

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Economies of scale refer to the cost advantage experienced by a firm when it increases its level of output. The advantage arises due to the inverse relationship between per-unit fixed cost and the quantity produced. The greater the quantity of output produced, the lower the per-unit fixed cost because these costs are spread out over a larger number of goods.

This Term Refers to How a Large Volume of Production