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In the Case of Economies-Of-Scale, as a Firm Increases Its

Question 11

Multiple Choice

In the case of economies-of-scale, as a firm increases its percent usage of hired inputs,

A) the resultant percent gain in productive output is less than the proportional increase in the hired inputs.
B) the resultant percent gain in productive output is about the same as the proportional increase in the hired inputs.
C) the resultant percent gain in productive output is greater than the proportional increase in the hired inputs.
D) the resultant percent gain in productive output cannot be predicted with any degree of confidence.
E) the law of diminishing returns determines the resultant percent gain in productive output.

Correct Answer: