Q. Which of the following statements describes increasing returns to scale: (Solved)
1. Doubling the inputs used leads to double the output.
2. Increasing the inputs by 50% leads to a 25% increase in output.
3. Increasing inputs by 1/4 leads to an increase in output of 1/3.
4. None of the above.
- c. Increasing inputs by 1/4 leads to an increase in output of 1/3.