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

Level:
A-Level
Board:
Edexcel

Last updated 1 Sept 2023

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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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