Increasing returns to scale suggests that ____________
A. a firm can make a profit by reducing output B. a firm can make more profit by increasing output C. as the producer reduces the quantity of raw materials used, the marginal product will double D. as the producer increases the quantity of raw materials used, the marginal product will fall
Correct Answer: B
Explanation
Increasing returns to scale is when the output increases in a greater proportion than the increase in input.
