Constant returns to scale is a property of a production function that holds when a proportional increase in all inputs results in an increase in output by:
Answer & explanation
Correct answer: option 1
The correct answer is Option (1) → the same proportion
Under constant returns to scale, raising all inputs by some proportion raises output by the same proportion: double the inputs, double the output.
NCERT (2026-27), Introductory Microeconomics, Glossary: “Constant returns to scale is a property of production function that holds when a proportional increase in all inputs results in an increase in output by the same proportion.” |