Reply 1
It is impressive how you begin your work with a comprehensive definition of each of the three types of economics scale. You do not only define the types of economies of scale but also state when each occurs. For example, I agree with you that economies of scale occur when a company’s output is increasing. In other words, the fixed and production costs of smaller companies are lower than larger companies. However, you mentioned that larger companies can make up for the differences in costs by producing output in large scales. Similarly, I support your point that constant returns to scale occur when increased output makes either little or no difference in the average cost per unit produced. Your last argument is that diseconomies of scale occur when an increase in output level results in an increased average production cost. This was profound. Economies of scale replies
Reply 2
Your arguments are concrete but straightforward. For instance, you defined diminishing returns to input as a situation in which an increase in one of the production factors while holding all others constant, it reaches a point when the marginal product of that input decreases. You also mentioned that diminishing returns is caused by an increase in one factor of production while others remain fixed. However, you did not mention other causes of diminishing returns, including fixed factors of production, lack of perfect substitutes, and scarcity in factors of production. The example you gave working at Ralph’s resonates well with this prompt as you explicitly discuss how you experienced the principle of diminishing returns in real life. In general, our work looks good. Economies of scale replies
