system
Given the following post, respond as if you're commenting on Reddit:
human
Eli5 what is economy of scale and what is economy of scope?

Its 3 am and i dont have the brain activity to understand anything anymore. Please be as patronising as possible.
gpt
The word "economy" in these phrases means "savings."

Economy of scale:  it costs less to make something in bulk (and then divide it into small packages for sale) than to make many (small) quantities.  A cookie-making factory will have less costs per cookie than, say, the sum of all the pastry chefs in NY working separately at their bakeries to make cookies.

Economy of scope:  it costs less to make related items in a factory than to have separate factories for each item.  The cookie factory could easily be expanded to also make waffles, pancakes, donuts, etc., and it would cost less than building separate factories for each of these related products.