By employing additional unit of labour to other fixed factor of production, if the total output increases at a constant rate, this phenomena is known as ______.

Law of increasing returns

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Law of increasing returns to scale

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Law of constant returns

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Law of decreasing returns to scale

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Solution

The correct option is B Law of constant returns
Constant returns to a variable factor: If increases in output is in the same proportion as increase in quantity of variable inputs, returns to a factor are said to be constant. The average cost remains constant.

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By employing additional unit of labour to other fixed factor of production, if the total output increases at a constant rate, this phenomena is known as ______.

The correct option is B Law of constant returnsConstant returns to a variable factor: If increases in output is in the same proportion as increase in quantity of variable inputs, returns to a factor are said to be constant. The average cost remains constant.

The correct option is B Law of constant returns
Constant returns to a variable factor: If increases in output is in the same proportion as increase in quantity of variable inputs, returns to a factor are said to be constant. The average cost remains constant.