If a firm's output more than doubles when all inputs are doubled,production is said to occur under conditions of
A) increasing returns to scale.
B) imperfect competition.
C) intra-industry equilibrium.
D) constant returns to scale
E) decreasing returns to scale.

Question

Quizplus · Accepted Answer

Increasing returns to scale occur when there is a proportional increase in output greater than the proportional increase in input. In this case, if all inputs are doubled and output more than doubles, it indicates that the production occurs under conditions of increasing returns to scale.

If a Firm's Output More Than Doubles When All Inputs