Economies of scale

High school (ages 12+)
People & Society

Name:

Date:

Step 1 · Read the article

Open the article and read it at the level above. Then answer the questions below in your own words.

https://smallwhale.org/articles/economies-of-scale

Write what each word means, using the article.

Do not copy the article. Write two things you learned, the way you would explain them to a friend.

Answers below are taken from the article’s stored facts, so they match what the student read.

1. What does 'economies of scale' mean?It means that when a company makes more of something, each item can cost less because the big costs are shared across many units.
2. Why do big factories make things cheaper?Big factories can use large machines that run efficiently, buy raw materials in bulk, and have specialists like managers, all of which lower the cost for each item.

Economies of Scale: Cost advantages realized by firms as their output volume increases, leading to lower per-unit production costs.
Average Total Cost: The total cost of production divided by the number of units produced.
Diseconomies of Scale: Situations where increasing the scale of operations leads to an increase in the average cost per unit of output.