a. Economies of scale help an organization to reduce the cost of products. Supplier offers quantity discounts when bulk supplies are obtained, fixed expenses in total remain the same hence per unit cost decreases, and there are various other factors that reduce the cost of the product. Hence it enables an organization to make more profit. Price set up by firms operating in an oligopoly is likely to give more advantage if production is done on a mass level.

b. Market share is important due to various reasons. When market share is high in oligopoly firms are in a better position to influence the market price. Moreover, economies of scale can be achieved only if the production of a firm is completely absorbed in the market. Economies of scale as discussed earlier generates more revenue to a firm in oligopoly.