Explain why do the smaller cells have better efficiency?

Small cells have larger ratio of surface area to volume and therefore the rate of diffusion and transport of nutrients across cell surface is faster. Faster rate is important for cells to function in an efficient way as it provide nutrients which are necessary for them to function. When cells gets bigger, their ratio of surface area to volume decreases and thus rate of diffusion and transport of nutrients become slower. Therefore, cells become less efficient. 

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Cells are small for a purpose: to increase their surface area-volume ratio. As a cell gets bigger (no matter what the shape of the cell is, being spherical, cuboidal, columnar, what have you...) the volume of the cell gets bigger FASTER than the surface area of the cell. The surface area is the outermost part of the cell and in the real world, this represents the cell membrane.This is bad news for a cell. Why? First you have to realize that the cell membrane is responsible for transporting things into and out of the cell. Basically then, the inside volume of the cell DEPENDS UPON the cell membrane to provide it with necessary nutrients so it can function. If the volume grows faster than the cell membrane (as the cell gets bigger), the the cell membrane's ability to function as a provider for the interior of the cell is greatly compromised. The cell solves this by dividing, to keep its overall cell size relatively small.

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