The ability to spread fixed costs over a large volume results in a cost-savings phenomenon referred to as:

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Economies of scale refer to the reductions in unit cost achieved by producing a large volume of a product.One is the ability to spread fixed costs over a large volume.Fixed costs are the costs required to set up a production facility,develop a new product,and the like.They can be substantial.

The Ability to Spread Fixed Costs Over a Large Volume