Question at position 12 Which of the following is NOT a reason for decreasing returns to scale?technology changegrowth of bureaucracyworker disaffectionmanagement command and control problems

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BlackTom AI · Accepted Answer

The question asks which item is NOT a reason for decreasing returns to scale. To address this, I will evaluate each option in turn.
Option 1: technology change. This is the correct choice for NOT being a reason because technology change can alter production possibilities and often leads to higher efficiency or different scales of output, potentially causing increasing returns or simply altering the production function rather than inherently causing a drop in output per unit as scale increases. In other words, technology shifts can improve productivity rather than reliably reduce it as output expands.
Option 2: growth of bureaucracy. As organizations expand, layers of management and red tape can slow decision-making and coordination, leading to inefficiencies that cause output to grow more slowly than inputs, which is a classic driver of decreasing returns to scale.
Option 3: worker disaffection. If workers become disengaged or morale declines with larger operations, productivity can fall, causing the marginal output per additional unit of input to drop. This is a common source of decreasing returns to scale because human factors impede efficient scaling.
Option 4: management command and control problems. Centralized or overly rigid control can hinder responsiveness and adaptability in larger operations, reducing efficiency and causing decreasing returns to scale as the organization grows beyond an optimal size.
Overall, the non-causal role of technology change in the context of decreasing returns is highlighted, while the other factors describe typical inefficiencies that emerge with larger scales of production.

Question at position 12 Which of the following is NOT a reason for decreasing returns to scale?technology changegrowth of bureaucracyworker disaffectionmanagement command and control problems

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Question at position 12 Which of the following is NOT a reason for decreasing returns to scale?technology changegrowth of bureaucracyworker disaffectionmanagement command and control problems

View Explanation

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