If a firm is experiencing _____________________, then as the quantity of output rises, the average cost of production rises.
A) decreasing returns to scale
B) consent returns to scale
C) economies of scale
D) increasing returns to scale

Question

Quizplus · Accepted Answer

Decreasing returns to scale occur when increasing the quantity of input results in a less than proportional increase in output, leading to a rise in the average cost of production as output increases. This contrasts with economies of scale and increasing returns to scale, where average costs decrease as output increases.

If a Firm Is Experiencing _____________________, Then as the Quantity