If all inputs are trebled and the resultant output is doubled, this is a case of

Constant returns to scale
Increasing returns to scale
Diminishing returns to scale
Negative returns to scale

The correct answer is: A. Constant returns to scale.

Constant returns to scale is a production situation in which a proportionate increase in all inputs results in a proportionate increase in output. In other words, if all inputs are trebled, the output will also be trebled.

Increasing returns to scale is a production situation in which a proportionate increase in all inputs results in a more than proportionate increase in output. In other words, if all inputs are trebled, the output will be more than trebled.

Diminishing returns to scale is a production situation in which a proportionate increase in all inputs results in a less than proportionate increase in output. In other words, if all inputs are trebled, the output will be less than trebled.

Negative returns to scale is a production situation in which a proportionate increase in all inputs results in a decrease in output. In other words, if all inputs are trebled, the output will decrease.

In the case of the question, if all inputs are trebled and the resultant output is doubled, this is a case of constant returns to scale. This is because the output has increased in the same proportion as the inputs.

Exit mobile version