Suppose the production of Topglove is currently exhibiting increasing returns to scale. Due to the slowing down market d

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answerhappygod
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Suppose the production of Topglove is currently exhibiting increasing returns to scale. Due to the slowing down market d

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Suppose the production of Topglove is currently exhibiting increasing returns to scale. Due to the slowing down market demand for gloves, the company has decided to reduce their inputs (both capital and labour) by 35 per cent. What is the expected impact on the production output of Topglove?
Select one:
a.
Output decreases by exactly 35 per cent.
b.
Output decreases by more than 35 per cent.
c.
Output decreases by less than 35 per cent.
d.
Output increases by less than 35 per cent.
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