Returns to Scale Refers to

question 36

Multiple Choice

Returns to scale refers to

• A)What happens to output when at least one input is fixed and one is varied
• B)What happens to output when all inputs are held fixed
• C)What happens to output when all inputs are varied in some proportion
• D)The law of diminishing returns

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Definitions:

Inventory Turnover

A ratio showing how often a company has sold and replaced its inventory during a certain period, indicating the efficiency of inventory management.

Return On Equity

A measure of financial performance calculated by dividing net income by shareholders' equity.

Total Debt Ratio

A financial ratio that measures the extent of a company’s leverage, calculated by dividing its total liabilities by its total assets.

Profit Margin

A financial metric indicating the percentage of revenue that exceeds the costs of goods sold, representing the profitability.