Use the following to answer questions below:

-Refer to the isoquant maps graph. Assume that the four isoquants in each graph represent output levels of 100, 200, 300, and 400. Which of the four graphs shows an isoquant map in which returns to scale are first decreasing and then increasing?
A) Graph D
B) Graph C
C) Graph B
D) None of the above is correct.

Question

Use the following to answer questions below:
 
-Refer to the isoquant maps graph. Assume that the four isoquants in each graph represent output levels of 100, 200, 300, and 400. Which of the four graphs shows an isoquant map in which returns to scale are first decreasing and then increasing?
A) Graph D 
B) Graph C 
C) Graph B 
D) None of the above is correct.

Quizplus · Accepted Answer

None of the provided options accurately describe a situation where returns to scale are first decreasing and then increasing, as this would imply a non-standard shape for isoquants that is not typically represented in standard economic graphs. Isoquants typically show constant, increasing, or decreasing returns to scale, but not a combination of decreasing and then increasing within the same set of isoquants.

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