5. Consider the following set of data that looks at how output changes following changes in inputs. (3 marks) Quantity o

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5 Consider The Following Set Of Data That Looks At How Output Changes Following Changes In Inputs 3 Marks Quantity O 1 (125.07 KiB) Viewed 45 times

5. Consider the following set of data that looks at how output changes following changes in inputs. (3 marks) Quantity of Labour Quantity of Capital 0 5 10 10 20 15 30 20 40 25 50 30 Output 0 100 250 450 575 650 Which of the following statements accurately describes what this data shows? (a) The firm experiences increasing returns to scale at all levels of output. (b) The firm experiences first increasing returns to scale and then runs into decreasing returns to scale. (c) The firm experiences first decreasing returns to scale and then increasing returns to scale. (d) The firm experiences increasing marginal returns to labour and increasing marginal returns to capital at all levels of output. 6. Suppose a firm is currently producing at point A on the diagram below. (3 marks) Costs LRAC A o Output This might indicate that: (a) The firm is experlencing economies of scope. (b) The firm is producing at the minimum efficient scale. (c) The firm is producing allocatively efficiently. (d) The firm is experlencing problems of control and coordination