AFC will decrease
Increasing returns to scale.
a]increasing marginal returns b]diminishing returns c]negative returns
The principle of diminishing marginal returns to inputs is when more on one input is added, while other inputs are held constant, the marginal product of the input diminishes. Diseconomies of scale or decreasing returns to scale is when the a firm doubles its inputs, output increases by less than double. With diminishing returns, only one input is being changed while holding the other is fixed. But for decreasing returns, both inputs may change
The principle of diminishing returns to inputs is when more on one input is added, while other inputs are held constant, the marginal product of the input diminishes. Decreasing returns to scale is when the a firm doubles its inputs, output increases by less than double. With diminishing returns, only one input is being changed while holding the other is fixed. But for decreasing returns, both inputs may change
The scale effect indicates what happens to the demand for the firm's inputs as the firm expands production. As long as capital and labor are "normal inputs," the scale effect increases both the firm's employment and capital stock.
Increasing returns to scale.
a]increasing marginal returns b]diminishing returns c]negative returns
what is the different between diminishing marginal productivity and decreasing return to scale?
When a firm doubles its inputs, outputs also double. The increase in output is exactly proportionate to the increase in inputs
The principle of diminishing marginal returns to inputs is when more on one input is added, while other inputs are held constant, the marginal product of the input diminishes. Diseconomies of scale or decreasing returns to scale is when the a firm doubles its inputs, output increases by less than double. With diminishing returns, only one input is being changed while holding the other is fixed. But for decreasing returns, both inputs may change
The principle of diminishing returns to inputs is when more on one input is added, while other inputs are held constant, the marginal product of the input diminishes. Decreasing returns to scale is when the a firm doubles its inputs, output increases by less than double. With diminishing returns, only one input is being changed while holding the other is fixed. But for decreasing returns, both inputs may change
The principle of diminishing marginal returns to inputs is when more on one input is added, while other inputs are held constant, the marginal product of the input diminishes. Decreasing returns to scale is when the a firm doubles its inputs, output increases by less than double. With diminishing returns, only one input is being changed while holding the other is fixed. But for decreasing returns, both inputs may change
The unique combination of resources, experiences, and expertise within a particular firm is called
The scale effect indicates what happens to the demand for the firm's inputs as the firm expands production. As long as capital and labor are "normal inputs," the scale effect increases both the firm's employment and capital stock.
Scale of economies = the size of the economies - i.e how big the economies/savings are. Economies of scale = those economies that come as a result of the organization being big (as opposed to the same costs of in organization which is smaller)
large firm means when a business has expand in order to benefit from economies of scale
Scale efficiency is the potential productivity gain from achieving optimal size of a firm