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ECONOMIES OF SCALE IB HL1 ECONOMICS Microeconomics.

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Presentation on theme: "ECONOMIES OF SCALE IB HL1 ECONOMICS Microeconomics."— Presentation transcript:

1 ECONOMIES OF SCALE IB HL1 ECONOMICS Microeconomics

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3 Introduction to Economies of Scale Video Takes notes during the video. Devise 3 questions to ask someone else in this class.

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8 Different Types of Economies of Scale Purchasing Economies of Scale (Bulk Buy Discounts) Financial Economies of Scale (cheaper loans) Managerial Economies of Scale Labor Specialization & Economies of Scale Promotional Economies of Scale Transport or Logistical Economies of Scale. Technical economies of Scale

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12 Which companies are big beneficiaries of economies of scale?

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14 A. Explain how the following companies or organization could or do benefit from Economies of Scale. 1 American Airlines mergers with US Airways. 2.Coca Cola gets a very large loan from Bank of America. 3.Amazon buys a fleet of trucks. 4.Three small local municipalities (local governments) merge to form one large super council. 5.Proctor & Gable spent $4.6 billion dollars on advertising in 2014 6. Suggest how AISG may get better deals when providing housing for staff.

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