An article in the Wall Street Journal quoted a business consultant as saying, “Today, companies are trying to get bigger to get economies of scale.”

a. What are economies of scale?
b. What benefits might a firm receive from attaining economies of scale before competing firms in the industry do?
c. Suppose you open a new restaurant in Los Angeles.
Can you use economies of scale as a barrier to entry so that your restaurant will be profitable in the long run? Briefly explain.