Question

Which of the following tables represents diminishing returns to scale?

Table 1			Table 2			Table 3			Table 4
K	L	TP	K	L	TP	K	L	TP	K	L	TP
1	2	10	1	2	10	1	2	10	1	2	10
2	4	30	2	4	20	2	4	25	2	4	50
4	8	100	4	8	40	4	8	35	4	8	200

In table : K stands for Capital, L for Labour, and TP for Total Production.
The correct option is-

• A. Table $1$
• B. Table $2$
• C. Table $3$
• D. Table $4$

Answer 1

The correct option is C Table $3$

Doubling the input the first time leads to an increase of 15 units of the output. However doubling the second time leads to increase of 10 units only in the output thus this exhibits diminishing returns to scale.