<p>You can only judge returns to scale by a <strong>simultaneous</strong> change in all inputs. Thus, in this case, if you want to test returns to scale, you have to use one of the first three rows <strong>and the last row</strong> as references. </p>

<p>So, by the definition of returns to scale, you can see that <strong>doubling the factors</strong> (this is, a move from top row to bottom row) <strong>doubles the output</strong>. Therefore, it must be the case that there are constant returns to scale. </p>

<p>The other two rows only show that labour is productive. This is, that it's marginal product is positive.</p>

CC BY-SA 3.0
2017-02-08T14:27:40.370Z
http://meta.economics.stackexchange.com/a/1663/1601
Giskard
CC BY-SA 3.0
2017-02-08T14:34:53.580Z
great, I can see the logic behind it now
tsp216
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2017-02-08T15:49:11.780Z
@denesp But the community has not decided the question is off-topic yet. It might never do. Thanks for the reference anyway.
luchonacho
CC BY-SA 3.0
2017-02-08T16:09:34.103Z
I think the community did [decide that this is off-topic](http://meta.economics.stackexchange.com/questions/1465/economics-se-policy-on-homework-questions) as it is a numbers based question about a basic concept with no effort. (OP even had the definition but did not use it.) Of course in the 22 minutes between the posting of the question and the posting of your answer the close vote on this question did not yet conclude.
Giskard
CC BY-SA 3.0
2017-02-08T14:06:29.887Z
2017-02-08T14:06:29.887Z
luchonacho
<p>The following table, which is part of a wider question, apparently shows constant returns to scale. My calculations do not seem to show that constant returns to scale occurs.</p>

<p><a href="https://i.sstatic.net/nllx6.jpg" rel="nofollow noreferrer"><img src="https://i.sstatic.net/nllx6.jpg" alt="enter image description here"></a></p>

<p>The correct answer is B.</p>

<p>I can find at least 2 sources claiming that returns to scale occurs when a same change in inputs results in the same quantity change in output</p>

<p>Wikipedia:  </p>

<blockquote>
  <p>If output increases by that same proportional change as all inputs
  change then there are constant returns to scale (CRS).</p>
</blockquote>

<p>EconomicsHelp.org:</p>

<blockquote>
  <p>Constant returns to scale occurs when increasing the number of inputs
  leads to an equivalent increase in the output.</p>
</blockquote>

CC BY-SA 3.0
2017-02-08T13:53:12.407Z
What do your calculations show ?
keepAlive
<economies-of-scale>
Does this table show constant returns to scale?
tsp216
# Does this table show constant returns to scale?

(Asked by: username_0 on 2017-02-08)

The following table, which is part of a wider question, apparently shows constant returns to scale. My calculations do not seem to show that constant returns to scale occurs.

[![enter image description here](https://i.sstatic.net/nllx6.jpg)](https://i.sstatic.net/nllx6.jpg)

The correct answer is B.

I can find at least 2 sources claiming that returns to scale occurs when a same change in inputs results in the same quantity change in output

Wikipedia:

> If output increases by that same proportional change as all inputs
> change then there are constant returns to scale (CRS).

EconomicsHelp.org:

> Constant returns to scale occurs when increasing the number of inputs
> leads to an equivalent increase in the output.

**Tags:** economies-of-scale
> **Comments:**
> **username_1**: What do your calculations show ?  

---

## 1 answers

### Answer by username_2 on 2017-02-08. Score: 0 | Accepted answer

You can only judge returns to scale by a **simultaneous** change in all inputs. Thus, in this case, if you want to test returns to scale, you have to use one of the first three rows **and the last row** as references.

So, by the definition of returns to scale, you can see that **doubling the factors** (this is, a move from top row to bottom row) **doubles the output**. Therefore, it must be the case that there are constant returns to scale.

The other two rows only show that labour is productive. This is, that it's marginal product is positive.

> **Comments:**
> **username_3**: http://meta.economics.stackexchange.com/a/1663/1601  
> **username_0**: great, I can see the logic behind it now  
> **username_2**: @denesp But the community has not decided the question is off-topic yet. It might never do. Thanks for the reference anyway.  
> **username_3**: I think the community did [decide that this is off-topic](http://meta.economics.stackexchange.com/questions/1465/economics-se-policy-on-homework-questions) as it is a numbers based question about a basic concept with no effort. (OP even had the definition but did not use it.) Of course in the 22 minutes between the posting of the question and the posting of your answer the close vote on this question did not yet conclude.  

---

