Which of the following paired concepts are equivalent to each other?
A)decreasing costs; economies of scale
B)constant costs; economies of scale
C)increasing returns; diseconomies of scale
D)decreasing returns; decreasing costs
E)increasing returns; increasing costs

Question

Quizplus · Accepted Answer

Decreasing costs and economies of scale are equivalent because as a firm produces more output, the average cost of producing each unit decreases due to spreading fixed costs over a larger output. This leads to economies of scale, which ultimately results in decreasing costs.

Which of the Following Paired Concepts Are Equivalent to Each