Understanding Returns to Scale

[@MsNadi10]

Thank you so much! In my lecture there was only theoretial explanation and I couldn't wrap my mind around it. But with your examples I understood everything!

[@econhelp_official]

I'm so glad! Yes the lectures can sometimes be confusing! I know all about that haha

[@peritalianosollutamente2689]

love your video! Thank you for explaining even the basics for us who are not familiar with them!

[@econhelp_official]

You’re so welcome! Happy to help!! I hope your studies went well!!

[@rexford_garbrah]

Simple and well-explained. Thank you.

[@econhelp_official]

Thanks! That's what I was aiming for (sometimes it works haha!)

[@globalupdate9832]

awesome, god bless you

[@econhelp_official]

Thank you! You too!

[@Tyrant-PlayZ-69]

Thanks for the information... it's quite good ❤️

[@econhelp_official]

So nice of you to comment! Thanks and good luck with your studies!

[@melikasalehi2551]

Thank you! Great as always : )

[@econhelp_official]

Thank you too for the support! 🧡🧡🧡 I really appreciate it, makes my day to see comments!

[@andrewphiri4081]

Too fast

[@econhelp_official]

Thanks for the feedback, really useful to hear!

[@joshuaodubamiro5922]

To me increasing returns to scale should be written in this way : 𝐹(𝑎𝐾,𝑎𝐿)

[@econhelp_official]

Hi! Okay, does this help: in your inequality, from some initial level of output, on the LHS we have the level of (amount of) output that we get if we change each of our inputs by a factor 'a'. On the RHS we have the level of (amount of) output when we multiply the original level of output by 'a'. So your inequality says, "the amount of output that we get if we change all of the inputs to production by some amount is smaller than if we multiplied the original amount of output by that same amount". This is decreasing RTS: We change all of our inputs by some amount and the corresponding increase in output is proportionately less. Does that help?