Ask Question
1 April, 12:06

Constant returns to scale occur when the firm's long-run

a. total costs are constant as output increases.

b. average total costs are constant as output increases.

c. average cost curve is falling as output increases.

d. average cost curve is rising as output increases.

+3
Answers (1)
  1. 1 April, 15:30
    0
    Answer: average total costs are constant as output increases (B)

    Explanation:

    Constant returns to scale is a situation that occurs when the average cost does not change when there is an increase in output.

    The long-run average total cost remains the same as there is a change in the quantity of

    output. Constant returns to scale occur when an increase in the number of inputs will lead to an equivalent rise in the output.
Know the Answer?
Not Sure About the Answer?
Get an answer to your question ✅ “Constant returns to scale occur when the firm's long-run a. total costs are constant as output increases. b. average total costs are ...” in 📙 Business if there is no answer or all answers are wrong, use a search bar and try to find the answer among similar questions.
Search for Other Answers