If a firm's output more than doubles when all inputs are doubled, production is said to occur under conditions of
A) intra-industry equilibrium.
B) decreasing returns to scale.
C) imperfect competition.
D) increasing returns to scale.
E) constant returns to scale

Question

Quizplus · Accepted Answer

Increasing returns to scale occur when a firm's output more than doubles when all inputs are doubled. This means that the firm benefits from economies of scale, and as it grows in size, its average cost of production decreases.

If a Firm's Output More Than Doubles When All Inputs