Final answer:
The firm is said to have infinite scalability when it can serve additional customers without any extra costs. This situation is an extreme case of economies of scale, exemplified by stores like Costco or Walmart.
Step-by-step explanation:
If an organization establishes a business where the incremental cost to serve more customers is zero, then the firm is said to have infinite scalability. That means that the business has reached a point where it can serve additional customers without incurring any additional costs. This concept is fundamentally tied to the idea of economies of scale, which describes the situation where, as the quantity of output increases, the cost per unit decreases. This principle is often observed in large warehouse stores like Costco or Walmart, where the larger scale of operation allows for lower average costs compared to smaller-scale producers.