Final answer:
Economies of scale refer to cost advantages large firms gain with increased size due to lower cost per unit as production scale grows.
Explanation:
Economies of scale refer to the cost advantages that large firms obtain as their size increases. This is due to the decreasing cost per unit of output with an expanding scale of production. Factors contributing to economies of scale include spreading fixed costs over more units, bulk-buying of materials, and increased specialization.
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