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

Question

Quizplus · Accepted Answer

Decreasing costs and economies of scale are equivalent to each other. As production increases, the cost of producing each unit decreases due to the spread of fixed costs over a larger output. This is referred to as economies of scale. Therefore, decreasing costs and economies of scale are the same concept.

Which of the Following Paired Concepts Are Equivalent to Each