Constant returns to scale,
Definition of Constant returns to scale:
Production process with neither economies nor diseconomies of scale: the output of the process increases or decreases simultaneously and in step with increase or decrease in the inputs. A plant with a constant returns to scale is equally efficient in producing small batches as it is in producing large batches. See also declining returns to scale and economies of scale.
How to use Constant returns to scale in a sentence?
- The production function that the economists were using had constant returns to scale so output was increasing by the same factor as input.
- You should always be ready to go in to a constant returns to scale mode just in case that will help you when you need it.
- The constant returns to scale concept was mentioned during the meeting as we would see our marginal profit fluctuate greatly.
Meaning of Constant returns to scale & Constant returns to scale Definition