You overheard Mr. John, the newly hired marketing manager, saying: “I think our company should take advantage of economies of scale by increasing output, thereby spreading out our overhead fixed...

You overheard Mr. John, the newly hired marketing manager, saying: “I think our company should take advantage of economies of scale by increasing output, thereby spreading out our overhead fixed costs”.
Would you agree with this statement? If not, provide a better description for the term “economies of scale”. Explain how they may be achieved by organizations. Highlight what would prevent them to occur.