CA Foundation Exam > CA Foundation Questions > Increase in all input leading to less than pr...
Start Learning for Free
Increase in all input leading to less than proportional increase in output is called ______:
- a)Increasing returns to scale
- b)Decreasing returns to scale
- c)Constant returns to scale
- d)Both increasing and decreasing returns to scale
Correct answer is option 'B'. Can you explain this answer?
| FREE This question is part of | Download PDF Attempt this Test |
Verified Answer
Increase in all input leading to less than proportional increase in ou...
It occurs if a given percentage increase in all inputs results in a smaller percentage increase in output. The most common explanation for decreasing Returns involves organization factors in very large firms. ... As a result, proportional increases in output require more than proportional increases in inputs.
View all questions of this test
Most Upvoted Answer
Increase in all input leading to less than proportional increase in ou...
Explanation:
Returns to scale refer to the relationship between the increase in inputs and the resulting increase in output. When all inputs are increased by a certain percentage and the output increases by a proportionally less percentage, it is called decreasing returns to scale.
Example:
Suppose a factory increases its inputs by 10%, which includes labor, capital, and raw materials. However, the output only increases by 5%. This means that the factory is experiencing decreasing returns to scale.
Significance:
Decreasing returns to scale can occur due to various reasons such as inefficiencies in the production process, lack of coordination between different departments, or limited access to resources. It can result in higher unit costs of production and lower profitability for the firm.
Conclusion:
Therefore, decreasing returns to scale is an important concept in economics that highlights the relationship between inputs and output in the production process. It is important for firms to understand the reasons behind decreasing returns to scale and take appropriate measures to improve their production processes to increase their profitability.
Returns to scale refer to the relationship between the increase in inputs and the resulting increase in output. When all inputs are increased by a certain percentage and the output increases by a proportionally less percentage, it is called decreasing returns to scale.
Example:
Suppose a factory increases its inputs by 10%, which includes labor, capital, and raw materials. However, the output only increases by 5%. This means that the factory is experiencing decreasing returns to scale.
Significance:
Decreasing returns to scale can occur due to various reasons such as inefficiencies in the production process, lack of coordination between different departments, or limited access to resources. It can result in higher unit costs of production and lower profitability for the firm.
Conclusion:
Therefore, decreasing returns to scale is an important concept in economics that highlights the relationship between inputs and output in the production process. It is important for firms to understand the reasons behind decreasing returns to scale and take appropriate measures to improve their production processes to increase their profitability.
Free Test
FREE
| Start Free Test |
Community Answer
Increase in all input leading to less than proportional increase in ou...
B
Attention CA Foundation Students!
To make sure you are not studying endlessly, EduRev has designed CA Foundation study material, with Structured Courses, Videos, & Test Series. Plus get personalized analysis, doubt solving and improvement plans to achieve a great score in CA Foundation.
|
Explore Courses for CA Foundation exam
|
|
Similar CA Foundation Doubts
Top Courses for CA FoundationView all
Increase in all input leading to less than proportional increase in output is called ______:a)Increasing returns to scaleb)Decreasing returns to scalec)Constant returns to scaled)Both increasing and decreasing returns to scaleCorrect answer is option 'B'. Can you explain this answer?
Question Description
Increase in all input leading to less than proportional increase in output is called ______:a)Increasing returns to scaleb)Decreasing returns to scalec)Constant returns to scaled)Both increasing and decreasing returns to scaleCorrect answer is option 'B'. Can you explain this answer? for CA Foundation 2024 is part of CA Foundation preparation. The Question and answers have been prepared according to the CA Foundation exam syllabus. Information about Increase in all input leading to less than proportional increase in output is called ______:a)Increasing returns to scaleb)Decreasing returns to scalec)Constant returns to scaled)Both increasing and decreasing returns to scaleCorrect answer is option 'B'. Can you explain this answer? covers all topics & solutions for CA Foundation 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for Increase in all input leading to less than proportional increase in output is called ______:a)Increasing returns to scaleb)Decreasing returns to scalec)Constant returns to scaled)Both increasing and decreasing returns to scaleCorrect answer is option 'B'. Can you explain this answer?.
Increase in all input leading to less than proportional increase in output is called ______:a)Increasing returns to scaleb)Decreasing returns to scalec)Constant returns to scaled)Both increasing and decreasing returns to scaleCorrect answer is option 'B'. Can you explain this answer? for CA Foundation 2024 is part of CA Foundation preparation. The Question and answers have been prepared according to the CA Foundation exam syllabus. Information about Increase in all input leading to less than proportional increase in output is called ______:a)Increasing returns to scaleb)Decreasing returns to scalec)Constant returns to scaled)Both increasing and decreasing returns to scaleCorrect answer is option 'B'. Can you explain this answer? covers all topics & solutions for CA Foundation 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for Increase in all input leading to less than proportional increase in output is called ______:a)Increasing returns to scaleb)Decreasing returns to scalec)Constant returns to scaled)Both increasing and decreasing returns to scaleCorrect answer is option 'B'. Can you explain this answer?.
Solutions for Increase in all input leading to less than proportional increase in output is called ______:a)Increasing returns to scaleb)Decreasing returns to scalec)Constant returns to scaled)Both increasing and decreasing returns to scaleCorrect answer is option 'B'. Can you explain this answer? in English & in Hindi are available as part of our courses for CA Foundation.
Download more important topics, notes, lectures and mock test series for CA Foundation Exam by signing up for free.
Here you can find the meaning of Increase in all input leading to less than proportional increase in output is called ______:a)Increasing returns to scaleb)Decreasing returns to scalec)Constant returns to scaled)Both increasing and decreasing returns to scaleCorrect answer is option 'B'. Can you explain this answer? defined & explained in the simplest way possible. Besides giving the explanation of
Increase in all input leading to less than proportional increase in output is called ______:a)Increasing returns to scaleb)Decreasing returns to scalec)Constant returns to scaled)Both increasing and decreasing returns to scaleCorrect answer is option 'B'. Can you explain this answer?, a detailed solution for Increase in all input leading to less than proportional increase in output is called ______:a)Increasing returns to scaleb)Decreasing returns to scalec)Constant returns to scaled)Both increasing and decreasing returns to scaleCorrect answer is option 'B'. Can you explain this answer? has been provided alongside types of Increase in all input leading to less than proportional increase in output is called ______:a)Increasing returns to scaleb)Decreasing returns to scalec)Constant returns to scaled)Both increasing and decreasing returns to scaleCorrect answer is option 'B'. Can you explain this answer? theory, EduRev gives you an
ample number of questions to practice Increase in all input leading to less than proportional increase in output is called ______:a)Increasing returns to scaleb)Decreasing returns to scalec)Constant returns to scaled)Both increasing and decreasing returns to scaleCorrect answer is option 'B'. Can you explain this answer? tests, examples and also practice CA Foundation tests.
|
|
Explore Courses for CA Foundation exam
|
|
Suggested Free Tests
Signup for Free!
Signup to see your scores go up within 7 days! Learn & Practice with 1000+ FREE Notes, Videos & Tests.
|
© EduRev
|
Education Revolution
|
|
Signup to see your scores
go up within 7 days!
Access 1000+ FREE Docs, Videos and Tests
Takes less than 10 seconds to signup