economies of scale

A Dictionary of Accounting,  January, 1999  by R. HUSSEY

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economies of scale (scale effect) Reductions in the average cost of production, and hence in the unit costs, when output is increased. If the average costs of production rise with output, this is known as diseconomies of scale. Economies of scale can enable a producer to offer his product at more competitive prices and thus to capture a larger share of the market.

Internal economies of scale occur when better use ...

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