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Ask a question to our educatorsWhat is the meaning of the term economies of scale?
The text book definition is when "cost per unit falls as output rises." If Apple only produces one iPhone, it'll be pretty expensive as there are a lot of fixed costs. If they produce 10 iPhones, it'll likely be a little cheaper. If they produce 1 million iPhones, it will be significantly cheaper. This is 'economies of scale'.
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