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If a change in all inputs leads to a proportionate change in output, it is case of
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- Constant returns to scale
- Diminishing returns to scale
- Increasing returns to scale
- Variable returns to scale
- Constant returns to scale
Correct Option: A
If output increases by that same proportional change as all inputs change then there are constant returns to scale (CRS). If output increases by less than that proportional change in inputs, there are decreasing returns to scale (DRS). If output increases by more than that proportional change in inputs, there are increasing returns to scale (IRS).
