Which of the following paired concepts are equivalent to each other?
A)constant costs; economies of scale
B)increasing returns; decreasing costs
C)increasing returns; increasing costs
D)increasing costs; economies of scale
E)increasing returns; diseconomies of scale

Question

Quizplus · Accepted Answer

Increasing returns and decreasing costs are equivalent concepts. When a firm experiences increasing returns, it means that its output increases at a faster rate than its inputs, leading to decreasing costs per unit of output. Therefore, they are conceptually equivalent. The other choices are not equivalent to each other or do not make conceptual sense.

Which of the Following Paired Concepts Are Equivalent to Each