Saturday, September 8, 2018

Economics of scale examples

Economics of scale can be seen in
production of a complex item such as a motor car. The production process involves many different  stages. Therefore in order  to produce a car you should bifurcate up the process and would require workers specialise in producing a certain part. e.g. a worker may become highly specialised in the design of a car; another in testing e.t.c. Specialisation requires less training of workers and a more efficient production process. However, if you have several distinct production processes, it is most efficient to have a large output.

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