Increasing returns in production implies the following, except:

Question

Quizplus · Accepted Answer

Increasing returns in production refers to the phenomenon where an increase in the quantity of inputs results in a more than proportional increase in the quantity of output. This can lead to economies of scale and lower per-unit production costs. However, it does not necessarily imply an increase in labor-requirements per unit of output. In fact, with increasing returns in production, labor productivity could increase, resulting in fewer labor-hours required to produce each unit of output.

Increasing Returns in Production Implies the Following, Except