What benefit do larger businesses typically experience?

Larger businesses typically experience economies of scale, which occur when the average costs of production decrease as the scale of output increases. This advantage arises from several factors, such as the ability to purchase raw materials in bulk at lower prices, increased operational efficiency, and the spread of fixed costs over a larger number of goods. For example, a larger company can invest in advanced technology or machinery that may be too costly for smaller businesses to afford, resulting in greater efficiency and lower costs per unit. These savings can give larger businesses a competitive edge in pricing and profitability, enabling them to operate more effectively in their respective markets.

The other options do not reflect benefits associated with larger businesses. Higher employee turnover typically represents a challenge rather than a benefit, as it may lead to increased recruitment and training costs. Increased administrative costs can arise when businesses grow, but they are not a benefit; rather, they can detract from overall efficiency. Decreased production capabilities does not align with the advantages of larger businesses, as they are generally better equipped to increase production due to greater resources and capacity.