economy of scale


economy of scale

      in economics, the relationship between the size of a plant or industry and the lowest possible cost of a product. When a factory increases output, a reduction in the average cost of a product is usually obtained. This reduction is known as economy of scale. Increased labour supply, better specialization, improved technology, and discovery of new resources or better implementation of existing ones all can increase output and lead to economy of scale. Conversely, diseconomy of scale can result when an increase in output causes the average cost to increase.

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Universalium. 2010.

Look at other dictionaries:

  • economy of scale — ► economy of scale a proportionate saving in costs gained by an increased level of production. Main Entry: ↑economy …   English terms dictionary

  • Economy of scale — Economies of scale are the cost advantages that a firm obtains due to expansion. Economies of scale may be utilized by any size firm expanding its scale of operation. The common ones are purchasing (bulk buying of materials through long term… …   Wikipedia

  • economy of scale — noun the saving in cost of production that is due to mass production • Hypernyms: ↑economy, ↑saving * * * : a reduction in the cost of producing something (as a car or a unit of electricity) brought about especially by increased size of… …   Useful english dictionary

  • Economy of scale — Dieser Artikel wurde auf der Koordinationsseite des WiwiWiki Projekts gelistet um die Bearbeitung effektiver gestalten zu können. Bitte beteilige dich an der Diskussion. Als Skaleneffekt (Skalenertrag, Größenkostenersparnis, Economies of Scale)… …   Deutsch Wikipedia

  • economy of scale — econ′omy of scale′ n. bus the reduction in unit cost achieved by manufacturing an item on a large scale • Etymology: 1970–75 …   From formal English to slang

  • economy of scale — A lower cost per unit produced, achieved through large scale production. The lower cost can result from better tools of production, greater discounts on purchased supplies, production of by products, and/or equipment or labor used at production… …   Financial and business terms

  • economy of scale — a proportionate saving in costs gained by an increased level of production. → economy …   English new terms dictionary

  • economy of scale — Date: 1944 a reduction in the cost of producing something (as a car or a unit of electricity) brought about especially by increased size of production facilities usually used in plural …   New Collegiate Dictionary

  • Economy of scale —   The principle that larger production facilities have lower unit costs than smaller facilities.   U.S. Dept. of Energy, Energy Information Administration s Energy Glossary …   Energy terms

  • economy — ► NOUN (pl. economies) 1) the state of a country or region in terms of the production and consumption of goods and services and the supply of money. 2) careful management of available resources. 3) a financial saving. 4) (also economy class) the… …   English terms dictionary


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