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Economics glossary · Firms and competition

Purchasing economies

What purchasing economies means in economics, as one of sources of economies of scale, with an example and a question to test yourself.

Definition
Purchasing economies
Purchasing economies are savings from buying inputs in bulk, which wins the firm a lower price per unit from its suppliers.
Example

Can you think of an example of purchasing economies?

Test yourself

Can you name five internal economies of scale?

Learn it properly: the module

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