Question: Why should some firms experience increasing returns to scale while others show constant or decreasing returns? What must be different about their production functions? Do

Why should some firms experience increasing returns to scale while others show constant or decreasing returns? What must be different about their production functions? Do you think that teaching economics (the production of an education service) is likely to display increasing, decreasing, or constant returns to scale? Defend your choice. How could we test to see if you are right or wrong?

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