<p>The surface area of a pipe with length <span class="math-container">$l$</span> and radius <span class="math-container">$r$</span> is <span class="math-container">$l2r\pi$</span>. This is approximately proportional to how much material you need to make the pipe,<sup>1</sup> so it is proportional to the cost of the pipe.</p>
<p>If we assume a constant flow speed <span class="math-container">$v$</span>, the amount of liquid flowing through the pipe is proportional to <span class="math-container">$vr^2\pi$</span>. In this formula <span class="math-container">$r$</span> is squared. Thus if we double the radius of the pipe, costs are doubled, but flowthrough/liquid carrying capacity is quadrupled, making the internal economics to scale increasing.</p>
<hr />
<p><sup>1</sup>Until some critical size is reached where the pipe breaks under the weight it carries.</p>

CC BY-SA 4.0
2024-02-25T14:40:08.033Z
2024-02-26T11:32:37.290Z
2024-02-26T11:32:37.290Z
Giskard
<p>I am currently studying international economics and I'm going over economies of scale, I get the concept, but there is an example in my textbook that  I don't understand.</p>
<p>Here is a screenshot for context.
<a href="https://i.sstatic.net/OEgBB.png" rel="nofollow noreferrer"><img src="https://i.sstatic.net/OEgBB.png" alt="enter image description here" /></a></p>
<p>I don't get the last example about tanks and pipes, I understand they are also internal scale economies, but I don't know what they mean by surface area or volume, wouldn't their contribution to output be quantity produce like the airplane example? or is it refering to something else?</p>

CC BY-SA 4.0
2024-02-25T14:33:31.403Z
Is screenshoting the text better in some way than copying the text and quoting it? The latter seems to take less space and is searchable.
Giskard
<international-trade><international-economics><economies-of-scale><returns-to-scale>
Economies of Scale, texbook example
KEll
# Economies of Scale, texbook example

(Asked by: username_0 on 2024-02-24)

I am currently studying international economics and I'm going over economies of scale, I get the concept, but there is an example in my textbook that I don't understand.

Here is a screenshot for context.
[![enter image description here](https://i.sstatic.net/OEgBB.png)](https://i.sstatic.net/OEgBB.png)

I don't get the last example about tanks and pipes, I understand they are also internal scale economies, but I don't know what they mean by surface area or volume, wouldn't their contribution to output be quantity produce like the airplane example? or is it refering to something else?

**Tags:** international-trade, international-economics, economies-of-scale, returns-to-scale

> **Comments:**
> **username_1**: Is screenshoting the text better in some way than copying the text and quoting it? The latter seems to take less space and is searchable.  

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## 1 answers

### Answer by username_1 on 2024-02-25. Score: 2

The surface area of a pipe with length $l$ and radius $r$ is $l2r\pi$. This is approximately proportional to how much material you need to make the pipe,1 so it is proportional to the cost of the pipe.

If we assume a constant flow speed $v$, the amount of liquid flowing through the pipe is proportional to $vr^2\pi$. In this formula $r$ is squared. Thus if we double the radius of the pipe, costs are doubled, but flowthrough/liquid carrying capacity is quadrupled, making the internal economics to scale increasing.

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1Until some critical size is reached where the pipe breaks under the weight it carries.


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