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 Form 3 Business Studies: Size and location of a firm lessons

External economies of scale

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Answer Text:
External economies of scale:
-Refers to benefits which accrue to a firm as a result of growth of the whole industry
Examples of external economies of scale include:
1. Development of infrastructure
2. Access to a pool of skilled labour
3. Development of service/subsidiary industries
4. Collaboration in research and marketing
5. Easy access to raw materials
6. Better management of waste products.