Easy1 markMultiple Choice
Domain 1.4: Additional Cloud ConceptsDomain 1Cloud ConceptsEconomies of Scale

AZ-900 · Question 14 · Domain 1.4: Additional Cloud Concepts

True or False: 'Economies of scale' means that cloud providers can offer lower costs because they operate at a massive scale, passing the savings on to customers.

Answer options:

A.

True

B.

False

How to approach this question

Think about buying in bulk at a wholesale store versus buying a single item at a retail store.

Full Answer

A.True✓ Correct
True
Economies of scale is the ability to do things more efficiently or at a lower cost per unit when operating at a larger scale. Cloud providers like Microsoft purchase massive amounts of hardware, reducing the per-unit cost, and pass those savings to customers.

Common mistakes

Confusing economies of scale with elasticity.

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