If all inputs are doubled and the resulting output increases by more than a factor to two, the technology features
A) increasing returns to scale
B) decreasing returns to scale
C) constant returns to scale

Question

Quizplus · Accepted Answer

When all inputs are doubled and the resulting output increases by more than a factor of two, it suggests that the technology exhibits increasing returns to scale, where a proportionate increase in inputs leads to a more than proportionate increase in output. This can be due to certain efficiencies or synergies that arise from increasing the scale of production.

If All Inputs Are Doubled and the Resulting Output Increases