Returns to specialization can occur when
A)increasing the amount of labor allows workers to specialize.
B)the exponents of the Cobb-Douglas production function are greater than 1.
C)a firm doubles its inputs.
D)the average cost curve is above the marginal costs curve.

Question

Quizplus · Accepted Answer

Increasing the amount of labor allows workers to specialize, which can increase productivity and returns to specialization. The other options may have an impact on productivity and costs, but do not directly relate to specialization.

Returns to Specialization Can Occur When