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Industrial Organisation 2022

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Question:

What are the 3 types of return according to returns to scale?

Author: Hjalmer Pedersen



Answer:

1. Increasing returns (economies of scale): output increases more than proportionately to the increase in all inputs 2. Constant returns: output increases proportionately with an increase in all inputs 3. Decreasing returns (diseconomies of scale): output increases less than proportionately to the increase in all inputs


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1.	Increasing returns (economies of scale): output increases more than proportionately to the increase in all inputs
2.	Constant returns: output increases proportionately with an increase in all inputs
3.	Decreasing returns (diseconomies of scale): output increases less than proportionately to the increase in all inputs
1 answer(s) in total