Which is a reason for decreasing returns to scale?

Use of more specialised machinesCorrect answerYour answerProblems of co-ordinating and supervising a very large organisationCorrect answerYour answerGreater division of labourCorrect answerYour answerBuying inputs in bulkCorrect answerYour answer

Show the answer and explanation

CorrectNot quiteAnswer B

Correct answer: B

As a firm grows very large, management becomes harder and output may rise less than inputs.
The other three are sources of increasing returns.

Concept: Sources of decreasing returns
Typical timeTypical: 70 s
Your timeYours: —

The rule this testsReturns to scale

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Ten questions from Production Function: TP, MP and AP, at your own pace.

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Which is a reason for decreasing returns to scale?

Explanation