One reason that firms will experience decreasing returns to scale is
A) The law of diminishing marginal returns
B) The specialization of inputs as scale increases
C) There is some fixed input that isn't being taken into consideration
D) It is difficult to manage a large firm effectively

Question

Quizplus · Accepted Answer

As firms grow larger, management and coordination become more complex, leading to inefficiencies and decreasing returns to scale.

One Reason That Firms Will Experience Decreasing Returns to Scale