Figure 13-10
-Refer to Figure 13-10. The firm experiences constant returns to scale if it changes its level of output from
A) Q1 to Q2.
B) Q2 to Q4.
C) Q1 to Q3.
D) Q4 to Q5.

Question

Figure 13-10 
-Refer to Figure 13-10. The firm experiences constant returns to scale if it changes its level of output from
A) Q1 to Q2. 
B) Q2 to Q4. 
C) Q1 to Q3. 
D) Q4 to Q5.

Quizplus · Accepted Answer

Constant returns to scale occur when increasing the level of output results in a proportional increase in inputs, meaning the average cost remains constant. This typically happens over a range of output levels, such as from Q2 to Q4.

Figure 13-10 -Refer to Figure 13-10. the Firm Experiences Constant Returns to Constant