Choose the correct statements in respect of returns to scale.

(A) Decreasing returns to scale occur when a proportional increase in all inputs is less than output.
(B) Constant returns to scale occur when a proportional increase in all inputs is the same as output.
(C) In the long run, factors of production are increased by the same proportion, or factors are scaled up.
(D) Increasing returns to scale occur when a proportional increase in all inputs is less than output.

Choose the correct answer from the options given below:

(B), (C) and (D) only

The correct answer is Option (4) → (B), (C) and (D) only

(A) Decreasing returns to scale occur when a proportional increase in all inputs is less than output. Incorrect This statement is incorrect because it describes increasing returns to scale, not decreasing. In decreasing returns to scale, when all inputs are increased by a certain proportion, output increases by a smaller proportion.
(B) Constant returns to scale occur when a proportional increase in all inputs is the same as output. Correct This statement is correct. Constant returns to scale occur when output increases in the same proportion as all inputs. For example, if all inputs double, output also doubles.
(C) In the long run, factors of production are increased by the same proportion, or factors are scaled up. Correct This statement is correct. In the long run, all factors are variable, and a firm can scale up production by increasing all inputs in the same proportion to observe returns to scale.
(D) Increasing returns to scale occur when a proportional increase in all inputs is less than output. Correct This statement is correct. Increasing returns to scale occur when a proportional increase in inputs leads to a more than proportional increase in output.