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Introduction to Economics 1
Introduction to Economics 1 Deneme Sınavı
Introduction to Economics 1 Deneme Sınavı Sorusu #754081
Introduction to Economics 1 Deneme Sınavı Sorusu #754081
If the output increases by the same percentage as the increase in all inputs, what is this situation called?
Increasing returns to scale |
Constant returns to scale |
Decreasing returns to scale |
Economies of scale |
Diseconomies of scale |
Yanıt Açıklaması:
Constant returns to scale is an increase in output by the same percentage as an increase in all inputs. On the other hand, if the output increases more than the percentage increase in inputs, we call this ‘increasing returns to scale’ or ‘economies of scale’. In addition, if the output increases less than the percentage increase in inputs, then there are ‘decreasing returns to scale’ or ‘diseconomies of scale’. The correct answer is B
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