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3.3.3 Internal Economies of Scale (Edexcel A-Level Economics Teaching PowerPoint)


Last updated 1 Sept 2023

This editable, downloadable powerpoint covers internal economies of scale.

In the long run, all costs are assumed to be variable.

Internal economies of scale are the unit cost advantages from a business expanding the scale of production in the long run.

They arise from the benefits of increasing returns to scale. Large-scale production often uses fewer inputs per unit of output.

Lower average costs are an improvement in productive efficiency and can give a business a competitive cost advantage.

Economies of scale can lead to lower prices for consumers and higher profits which is good news for shareholders.

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