{"id":3761,"date":"2020-03-02T15:00:24","date_gmt":"2020-03-02T15:00:24","guid":{"rendered":"https:\/\/commerceiets.com\/?p=3761"},"modified":"2020-03-02T15:00:24","modified_gmt":"2020-03-02T15:00:24","slug":"law-of-increasing-returns","status":"publish","type":"post","link":"https:\/\/commerceiets.com\/law-of-increasing-returns\/","title":{"rendered":"LAW OF INCREASING RETURNS"},"content":{"rendered":"\n<div id=\"ez-toc-container\" class=\"ez-toc-v2_0_69_1 counter-hierarchy ez-toc-counter ez-toc-grey ez-toc-container-direction\">\n<div class=\"ez-toc-title-container\">\n<p class=\"ez-toc-title\" style=\"cursor:inherit\">Table of Contents<\/p>\n<span class=\"ez-toc-title-toggle\"><a href=\"#\" class=\"ez-toc-pull-right ez-toc-btn ez-toc-btn-xs ez-toc-btn-default ez-toc-toggle\" aria-label=\"Toggle Table of Content\"><span class=\"ez-toc-js-icon-con\"><span class=\"\"><span class=\"eztoc-hide\" style=\"display:none;\">Toggle<\/span><span class=\"ez-toc-icon-toggle-span\"><svg style=\"fill: #999;color:#999\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" class=\"list-377408\" width=\"20px\" height=\"20px\" viewBox=\"0 0 24 24\" fill=\"none\"><path d=\"M6 6H4v2h2V6zm14 0H8v2h12V6zM4 11h2v2H4v-2zm16 0H8v2h12v-2zM4 16h2v2H4v-2zm16 0H8v2h12v-2z\" fill=\"currentColor\"><\/path><\/svg><svg style=\"fill: #999;color:#999\" class=\"arrow-unsorted-368013\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" width=\"10px\" height=\"10px\" viewBox=\"0 0 24 24\" version=\"1.2\" baseProfile=\"tiny\"><path d=\"M18.2 9.3l-6.2-6.3-6.2 6.3c-.2.2-.3.4-.3.7s.1.5.3.7c.2.2.4.3.7.3h11c.3 0 .5-.1.7-.3.2-.2.3-.5.3-.7s-.1-.5-.3-.7zM5.8 14.7l6.2 6.3 6.2-6.3c.2-.2.3-.5.3-.7s-.1-.5-.3-.7c-.2-.2-.4-.3-.7-.3h-11c-.3 0-.5.1-.7.3-.2.2-.3.5-.3.7s.1.5.3.7z\"\/><\/svg><\/span><\/span><\/span><\/a><\/span><\/div>\n<nav><ul class='ez-toc-list ez-toc-list-level-1 ' ><li class='ez-toc-page-1 ez-toc-heading-level-1'><a class=\"ez-toc-link ez-toc-heading-1\" href=\"https:\/\/commerceiets.com\/law-of-increasing-returns\/#LAW_OF_INCREASING_RETURNS\" title=\"LAW\nOF INCREASING RETURNS\">LAW\nOF INCREASING RETURNS<\/a><ul class='ez-toc-list-level-3' ><li class='ez-toc-heading-level-3'><ul class='ez-toc-list-level-3' ><li class='ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-2\" href=\"https:\/\/commerceiets.com\/law-of-increasing-returns\/#ASSUMPTIONS_OF_THE_LAW_OF_INCREASING_RETURNS\" title=\"ASSUMPTIONS OF THE LAW OF INCREASING RETURNS\">ASSUMPTIONS OF THE LAW OF INCREASING RETURNS<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-3\" href=\"https:\/\/commerceiets.com\/law-of-increasing-returns\/#EXPLANATION_OF_LAW\" title=\"EXPLANATION\nOF LAW\">EXPLANATION\nOF LAW<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-4\" href=\"https:\/\/commerceiets.com\/law-of-increasing-returns\/#CAUSES_OF_APPLICABILITY_OF_LAW_OF_INCREASING_RETURNS\" title=\"CAUSES OF APPLICABILITY OF LAW OF\nINCREASING RETURNS\">CAUSES OF APPLICABILITY OF LAW OF\nINCREASING RETURNS<\/a><ul class='ez-toc-list-level-4' ><li class='ez-toc-heading-level-4'><a class=\"ez-toc-link ez-toc-heading-5\" href=\"https:\/\/commerceiets.com\/law-of-increasing-returns\/#1_Improved_Organisation\" title=\"1.&nbsp;Improved Organisation:\">1.&nbsp;Improved Organisation:<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-4'><a class=\"ez-toc-link ez-toc-heading-6\" href=\"https:\/\/commerceiets.com\/law-of-increasing-returns\/#2_Indivisibility_of_Factors\" title=\"2.&nbsp;Indivisibility of Factors:\">2.&nbsp;Indivisibility of Factors:<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-4'><a class=\"ez-toc-link ez-toc-heading-7\" href=\"https:\/\/commerceiets.com\/law-of-increasing-returns\/#3_External_and_Internal_Economies\" title=\"3.&nbsp;External and Internal Economies:\">3.&nbsp;External and Internal Economies:<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-4'><a class=\"ez-toc-link ez-toc-heading-8\" href=\"https:\/\/commerceiets.com\/law-of-increasing-returns\/#4_Use_of_Division_of_Labour_and_Specialisation\" title=\"4.&nbsp;Use of Division of Labour and Specialisation:\">4.&nbsp;Use of Division of Labour and Specialisation:<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-4'><a class=\"ez-toc-link ez-toc-heading-9\" href=\"https:\/\/commerceiets.com\/law-of-increasing-returns\/#5_Scientific_Inventions_and_the_Use_of_New_Techniques\" title=\"5.&nbsp;Scientific Inventions and the Use of New Techniques:\">5.&nbsp;Scientific Inventions and the Use of New Techniques:<\/a><\/li><\/ul><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-10\" href=\"https:\/\/commerceiets.com\/law-of-increasing-returns\/#APPLICATIONS_OF_LAW_OF_INCREASING_RETURNS_OR_DIMINISHING_COSTS\" title=\"APPLICATIONS OF LAW OF INCREASING RETURNS OR DIMINISHING COSTS\">APPLICATIONS OF LAW OF INCREASING RETURNS OR DIMINISHING COSTS<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-11\" href=\"https:\/\/commerceiets.com\/law-of-increasing-returns\/#LIMITATIONS_OF_THE_LAW_OF_INCREASING_RETURNS\" title=\"LIMITATIONS OF THE LAW OF INCREASING RETURNS\">LIMITATIONS OF THE LAW OF INCREASING RETURNS<\/a><\/li><\/ul><\/li><\/ul><\/li><\/ul><\/nav><\/div>\n<h1 class=\"has-text-align-center wp-block-heading\" id=\"law-of-increasing-returns\"><span class=\"ez-toc-section\" id=\"LAW_OF_INCREASING_RETURNS\"><\/span><strong>LAW\nOF INCREASING RETURNS<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h1>\n\n\n\n<p>The law of Increasing Returns is also known as the&nbsp;<em><strong>Law of Diminishing Costs<\/strong>.&nbsp;<\/em>According to this law when more and more units of variable factors are employed while other factors are kept constant, there will be an increase of <a href=\"https:\/\/commerceiets.com\/production-function\/\" target=\"_blank\" rel=\"noreferrer noopener\" aria-label=\"production (opens in a new tab)\">production<\/a> at a higher rate. This law is applicable to all different industries and partially applicable in agricultural sector.<\/p>\n\n\n\n<p><strong>STATEMENT\nOF THE LAW<\/strong><\/p>\n\n\n\n<p>\u201cThe tendency of the marginal\nreturn to rise per unit of variable factors employed In fixed amounts of other\nfactors by a firm Is called the law of increasing return\u201d.<\/p>\n\n\n\n<p><strong>ACCORDING TO PROF. MARSHALL<\/strong><\/p>\n\n\n\n<p><strong>\u201cAn increase in labour and\ncapital leads generally to improve organisation which increases the efficiency\nof the work of labour and capital.\u201d<\/strong><\/p>\n\n\n\n<h3 class=\"has-text-align-center wp-block-heading\" id=\"assumptions-of-the-law-of-increasing-returns\"><span class=\"ez-toc-section\" id=\"ASSUMPTIONS_OF_THE_LAW_OF_INCREASING_RETURNS\"><\/span><strong>ASSUMPTIONS OF THE <strong>LAW OF INCREASING RETURNS<\/strong><\/strong><span class=\"ez-toc-section-end\"><\/span><\/h3>\n\n\n\n<ol class=\"wp-block-list\"><li>There is always a scope of improvement in\ntechnology and techniques of production.<\/li><li>At least one factor of production is assumed\nto be indivisible.<\/li><li>Some factors are assumed divisible.<\/li><\/ol>\n\n\n\n<h3 class=\"has-text-align-center wp-block-heading\" id=\"explanation-of-law\"><span class=\"ez-toc-section\" id=\"EXPLANATION_OF_LAW\"><\/span><strong>EXPLANATION\nOF LAW<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h3>\n\n\n\n<p>The\nlaw can be explained with the help of the following schedule and diagram:\nSchedule:<\/p>\n\n\n\n<figure class=\"wp-block-image size-large\"><img loading=\"lazy\" decoding=\"async\" width=\"611\" height=\"220\" src=\"https:\/\/commerceiets.com\/wp-content\/uploads\/2020\/03\/increasing-returns-table.png\" alt=\"increasing returns table.png\" class=\"wp-image-3763\" srcset=\"https:\/\/commerceiets.com\/wp-content\/uploads\/2020\/03\/increasing-returns-table.png 611w, https:\/\/commerceiets.com\/wp-content\/uploads\/2020\/03\/increasing-returns-table-300x108.png 300w\" sizes=\"(max-width: 611px) 100vw, 611px\" \/><figcaption><strong>LAW OF INCREASING RETURNS<\/strong><\/figcaption><\/figure>\n\n\n\n<p>The schedule shows that the quantity of\ncapital remains the same i.e. 2 machines throughout the production process but\nthe number of laborers is increased from time to time. The first laborer has\nproduced a total production (TP) of 10 meters of cloth. After applying the 2<sup>nd<\/sup>&nbsp;laborer total production is increased to 22\nmeters. The marginal production (MP) of the second laborer is 12, which goes on\nincreasing. After the use of the 3rd, 4th and then the 5<sup>th<\/sup>&nbsp;laborer the total production is increased\nfrom 36 to 70 meters and the M.P from 14 to 18 meters.<\/p>\n\n\n\n<p>This can be explained with the\nhelp of following curve:<\/p>\n\n\n\n<figure class=\"wp-block-image size-large\"><img loading=\"lazy\" decoding=\"async\" width=\"311\" height=\"260\" src=\"https:\/\/commerceiets.com\/wp-content\/uploads\/2020\/03\/increasing-returns-diagram.png\" alt=\"increasing returns diagram.png\" class=\"wp-image-3764\" srcset=\"https:\/\/commerceiets.com\/wp-content\/uploads\/2020\/03\/increasing-returns-diagram.png 311w, https:\/\/commerceiets.com\/wp-content\/uploads\/2020\/03\/increasing-returns-diagram-300x251.png 300w\" sizes=\"(max-width: 311px) 100vw, 311px\" \/><figcaption><strong>LAW OF INCREASING RETURNS<\/strong><\/figcaption><\/figure>\n\n\n\n<p>In the diagram the quantity of\nlabour is measured along X-axis while the marginal production (MP) and total\nproduction (TP) are measured along Y-axis. The Marginal Production Curve is\nrepresented by MK, which is sloping up-ward showing an increase in the TP after\nthe use of additional amount of labour. With the use of additional amount of\nlabour, from left to the right on X-axis, MP is increased which is shown on\nY-axis.<\/p>\n\n\n\n<h3 class=\"has-text-align-center wp-block-heading\" id=\"causes-of-applicability-of-law-of-increasing-returns\"><span class=\"ez-toc-section\" id=\"CAUSES_OF_APPLICABILITY_OF_LAW_OF_INCREASING_RETURNS\"><\/span><strong>CAUSES OF APPLICABILITY OF LAW OF\nINCREASING RETURNS<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h3>\n\n\n\n<h4 class=\"wp-block-heading\" id=\"1-improved-organisation\"><span class=\"ez-toc-section\" id=\"1_Improved_Organisation\"><\/span>1.&nbsp;Improved Organisation:<span class=\"ez-toc-section-end\"><\/span><\/h4>\n\n\n\n<p>Prof. Marshall has said that the important reason for the\noperation of Law of Increasing Returns is that \u201can increase of labour and.\ncapital leads generally to improve organisation which increases the efficiency\nof the work of labour and capital.\u201d Hence, it can be said that an increase in\nthe efficiency of labour and capital in production increases the proportion of\nproduction.<\/p>\n\n\n\n<h4 class=\"wp-block-heading\" id=\"2-indivisibility-of-factors\"><span class=\"ez-toc-section\" id=\"2_Indivisibility_of_Factors\"><\/span>2.&nbsp;Indivisibility of Factors:<span class=\"ez-toc-section-end\"><\/span><\/h4>\n\n\n\n<p>Next, reason is the indivisibility of factors or means\nintroduced in production. In the field of production there are certain means\nwhich cannot be used in small division or in small parts which can increase\nproduction.<\/p>\n\n\n\n<h4 class=\"wp-block-heading\" id=\"3-external-and-internal-economies\"><span class=\"ez-toc-section\" id=\"3_External_and_Internal_Economies\"><\/span>3.&nbsp;External and Internal Economies:<span class=\"ez-toc-section-end\"><\/span><\/h4>\n\n\n\n<p>In some production due to increase in the means of\nproduction. Some economies in external and internal means are studied and is\nenforced which leads to reduction in production cost.<\/p>\n\n\n\n<h4 class=\"wp-block-heading\" id=\"4-use-of-division-of-labour-and-specialisation\"><span class=\"ez-toc-section\" id=\"4_Use_of_Division_of_Labour_and_Specialisation\"><\/span>4.&nbsp;Use of Division of Labour and Specialisation:<span class=\"ez-toc-section-end\"><\/span><\/h4>\n\n\n\n<p>When large scale production is adopted. Use of division\nof labour and specialisation in work becomes possible. In this way the cost can\nbe reduced and production may be increased.<\/p>\n\n\n\n<h4 class=\"wp-block-heading\" id=\"5-scientific-inventions-and-the-use-of-new-techniques\"><span class=\"ez-toc-section\" id=\"5_Scientific_Inventions_and_the_Use_of_New_Techniques\"><\/span>5.&nbsp;Scientific Inventions and the Use of New Techniques:<span class=\"ez-toc-section-end\"><\/span><\/h4>\n\n\n\n<p>By the new scientific inventions and the use of new\ntechnical appliances the production can be increased and the cost of production\ncan be reduced.<\/p>\n\n\n\n<h3 class=\"has-text-align-center wp-block-heading\" id=\"applications-of-law-of-increasing-returns-or-diminishing-costs\"><span class=\"ez-toc-section\" id=\"APPLICATIONS_OF_LAW_OF_INCREASING_RETURNS_OR_DIMINISHING_COSTS\"><\/span><strong>APPLICATIONS OF LAW OF INCREASING RETURNS OR DIMINISHING COSTS<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h3>\n\n\n\n<p>The law of increasing returns is\nmore applicable in industrial sector than agricultural sector. But it is not\napplicable for a long period of time because after a certain time period its\napplication comes to an end, and this stage is known as the optimum stage.<\/p>\n\n\n\n<p>The law of increasing returns generally applies to\nmanufacturing industries. Here man is not hampered by nature. He goes ahead and\nbenefits from all sorts of economies, both internal and external. We have\nalready discussed the economies of large-scale production. They are all\navailable to a big manu\u00adfacturer. As he increases the scale, production becomes\nmore and more economical. The cost of production falls, which means an\nincreasing return.<\/p>\n\n\n\n<p><strong>There are several reasons on\naccount of which the law of increasing returns operates in manufactures:<\/strong><\/p>\n\n\n\n<p>(i) There is a large scope for the introduction of\nmachinery. What is more important is that it can be kept continuously at work.\nThe result is that capital costs per unit of output are less.<\/p>\n\n\n\n<p>(ii) There is ample scope for the use of specialised\nlabour. The result is a large output, which means lowering of costs. This means\nincreasing returns.<\/p>\n\n\n\n<p>(iii) The manufacturing industries, being generally on a\nlarge scale, are able to realise economies of scale, both internal and\nexternal. These economies relate to buying and selling, economy in\nadministration, publicity and salesman\u00adship, benefit of research and\nexperiments, financial, technical and managerial economies, etc.<\/p>\n\n\n\n<p>(iv) Unlike agriculture, interruptions in work from\nnatural disturbances, like changes in weather and seasons, are on a minor\nscale. Hence there are no costly breakdowns. Production is smooth and\neconomical, which means increasing returns.<\/p>\n\n\n\n<p>(v) The operations are carried on within a small area so\nthat supervision is easy and effective. There is little waste of materials and\nspoiling of machinery. Expert guidance and advice are always at hand. Hence\nproduction is carried on economically.<\/p>\n\n\n\n<p>It is on account of all these reasons that the law of\nincreasing returns operates in industry. But the business cannot go on\nexpanding itself indefinitely. There comes a time when economies change into\ndiseconomies as the business becomes unwieldy.<\/p>\n\n\n\n<h3 class=\"has-text-align-center wp-block-heading\" id=\"limitations-of-the-law-of-increasing-returns\"><span class=\"ez-toc-section\" id=\"LIMITATIONS_OF_THE_LAW_OF_INCREASING_RETURNS\"><\/span><strong>LIMITATIONS OF THE LAW OF INCREASING RETURNS<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h3>\n\n\n\n<p>Important\nlimitations of the Law of Increasing Returns are as follows:<\/p>\n\n\n\n<p>1. If the size of the production unit is large and\nefficient management is not possible, then in this area the Law of Increasing\nReturn will not operate.<\/p>\n\n\n\n<p>2. If the machines and other instruments and tools are\nold even by increase in labour and capital the Law of Diminishing Return will\napply.<\/p>\n\n\n\n<p>3. If the industry needs rationalisation and division of\nlabour, and if this is not introduced or followed, then in place of increasing\nreturn Law of Diminishing Return will operate.<\/p>\n\n\n\n<p>4. If the industry is based on nature, then Law of\nIncreasing Return will not operate.<\/p>\n\n\n\n<p>5. If the use of advertisement is not adopted the use of Law of Increasing Return is not possible.<\/p>\n\n\n\n<figure class=\"wp-block-table\"><table><tbody><tr><td><strong>Also Study<\/strong><\/td><td><strong>Also Study<\/strong><\/td><td><strong>Also Study<\/strong><\/td><td><strong>Also Study<\/strong><\/td><\/tr><tr><td><a href=\"https:\/\/commerceiets.com\/demand\/\">Theory of Demand<\/a><\/td><td><a href=\"https:\/\/commerceiets.com\/law-of-demand\/\">Law of Demand<\/a><\/td><td><a href=\"https:\/\/commerceiets.com\/demand-function\/\">Demand Function<\/a><\/td><td><a href=\"https:\/\/commerceiets.com\/exceptions-of-law-of-demand\/\">Exceptions of law of demand<\/a><\/td><\/tr><tr><td><a href=\"https:\/\/commerceiets.com\/elasticity-of-demand\/\">Elasticity of demand<\/a><\/td><td><a href=\"https:\/\/commerceiets.com\/change-in-demand\/\">Change in demand<\/a><\/td><td><a href=\"https:\/\/commerceiets.com\/price-elasticity-of-demand\/\">Price elasticity of demand<\/a><\/td><td><a href=\"https:\/\/commerceiets.com\/difference-between-law-of-demand-and-elasticity-of-demand\/\">Law of demand Vs Elasticity of demand<\/a><\/td><\/tr><tr><td><a href=\"https:\/\/commerceiets.com\/factors-affecting-price-elasticity-of-demand\/\">Factors affecting price elasticity of demand<\/a><\/td><td><a href=\"https:\/\/commerceiets.com\/production-function\/\">Production function<\/a><\/td><td><a href=\"https:\/\/commerceiets.com\/difference-between-short-run-long-run-production-function\/\">Short run vs long run production function<\/a><\/td><td><a href=\"https:\/\/commerceiets.com\/law-of-variable-proportions\/\">Law of variable proportions<\/a><\/td><\/tr><tr><td><a href=\"https:\/\/commerceiets.com\/types-of-demand\/\">Types of demand<\/a><\/td><td><a href=\"https:\/\/commerceiets.com\/managerial-economics\/\">Managerial economics<\/a><\/td><td><a href=\"https:\/\/commerceiets.com\/characteristics-of-managerial-economics\/\">Characteristics of managerial economics<\/a><\/td><td><a href=\"https:\/\/commerceiets.com\/scope-of-managerial-economics\/\">Scope of managerial economics<\/a><\/td><\/tr><tr><td><a href=\"https:\/\/commerceiets.com\/utility-analysis\/\">Utility analysis<\/a><\/td><td><a href=\"https:\/\/commerceiets.com\/law-of-diminishing-marginal-utility\/\">Law of diminishing marginal utility<\/a><\/td><td><a href=\"https:\/\/commerceiets.com\/law-of-equi-marginal-utility\/\">Law of equi marginal utility<\/a><\/td><td><a href=\"https:\/\/commerceiets.com\/consumer-equilibrium\/\">Consumers Equilibrium<\/a><\/td><\/tr><tr><td><a href=\"https:\/\/commerceiets.com\/indifference-curve-analysis\/\">Indifference curve analysis<\/a><\/td><td><a href=\"https:\/\/commerceiets.com\/consumer-equilibrium-using-indifference-curve-analysis\/\">Consumer equilibrium using indifference curve analysis<\/a><\/td><td><a href=\"https:\/\/commerceiets.com\/relationship-between-tp-ap-and-mp\/\">Relationship between TP, AP and MP<\/a><\/td><td><a href=\"https:\/\/commerceiets.com\/law-of-increasing-returns\/\">Law of increasing returns<\/a><\/td><\/tr><tr><td><a href=\"https:\/\/commerceiets.com\/law-of-diminishing-returns\/\">Law of diminishing returns<\/a><\/td><td><a href=\"https:\/\/commerceiets.com\/law-of-constant-returns\/\">Law of constant returns<\/a><\/td><td><a href=\"https:\/\/commerceiets.com\/returns-to-scale\/\">Returns to Scale<\/a><\/td><td><a href=\"https:\/\/commerceiets.com\/economies-and-diseconomies-of-scale\/\">Economies and diseconomies of scale<\/a><\/td><\/tr><tr><td><a href=\"https:\/\/commerceiets.com\/concept-of-costs\/\">Concept of costs<\/a><\/td><td><a href=\"https:\/\/commerceiets.com\/relationship-between-ac-and-mc\/\">Relationship between AC and MC<\/a><\/td><td><a href=\"https:\/\/commerceiets.com\/traditional-theory-of-cost\/\">Traditional theory of costs<\/a><\/td><td><a href=\"https:\/\/commerceiets.com\/modern-theory-of-cost\/\">Modern theory of costs<\/a><\/td><\/tr><tr><td><a href=\"https:\/\/commerceiets.com\/explicit-vs-implicit-costs\/\">Explicit vs Implicit costs<\/a><\/td><td><a href=\"https:\/\/commerceiets.com\/revenue\/\">Revenue<\/a><\/td><td><a href=\"https:\/\/commerceiets.com\/perfect-competition\/\">Perfect competition<\/a><\/td><td><a href=\"https:\/\/commerceiets.com\/monopoly-meaning\/\">Monopoly<\/a>&nbsp;<\/td><\/tr><tr><td><a href=\"https:\/\/commerceiets.com\/price-discrimination\/\">Price discrimination<\/a><\/td><td><a href=\"https:\/\/commerceiets.com\/difference-between-perfect-competition-and-monopoly\/\">Difference between perfect competition and monopoly<\/a><\/td><td><a href=\"https:\/\/commerceiets.com\/perfect-and-monopolistic-competition\/\">Perfect Vs Monopolistic competition<\/a><\/td><td><a href=\"https:\/\/commerceiets.com\/monopoly-and-monopolistic-competition\/\">Monopoly and monopolistic competition<\/a><\/td><\/tr><tr><td><a href=\"https:\/\/commerceiets.com\/product-differentiation-strategy\/\">Product differentiation strategy<\/a><\/td><td><a href=\"https:\/\/commerceiets.com\/monopolistic-competition\/\">Monopolistic competition<\/a><\/td><td><a href=\"https:\/\/commerceiets.com\/national-income-in-india\/\">National Income in India<\/a><\/td><td><a href=\"https:\/\/commerceiets.com\/measurement-of-national-income\/\">Measurement of national income in India<\/a><\/td><\/tr><tr><td><a href=\"https:\/\/commerceiets.com\/consumption-function\/\">Consumption function<\/a><\/td><td><a href=\"https:\/\/commerceiets.com\/keynesian-psychological-law-of-consumption\/\">Keynes Psychological law of consumption<\/a><\/td><td><\/td><td><\/td><\/tr><\/tbody><\/table><\/figure>\n\n\n\n<div class=\"wp-block-buttons is-layout-flex wp-block-buttons-is-layout-flex\">\n<div class=\"wp-block-button\"><a class=\"wp-block-button__link\" href=\"https:\/\/www.linkedin.com\/in\/kajal-mahajan-7549b2197\/\" target=\"_blank\" rel=\"noreferrer noopener\">CONNECT ON LINKEDIN<\/a><\/div>\n<\/div>\n\n\n\n<figure class=\"wp-block-image size-large\"><img loading=\"lazy\" decoding=\"async\" width=\"1024\" height=\"266\" src=\"https:\/\/commerceiets.com\/wp-content\/uploads\/2019\/04\/cropped-Presentation-resize-1024x266.jpg\" alt=\"LAW OF INCREASING RETURNS\" class=\"wp-image-787\" srcset=\"https:\/\/commerceiets.com\/wp-content\/uploads\/2019\/04\/cropped-Presentation-resize-1024x266.jpg 1024w, https:\/\/commerceiets.com\/wp-content\/uploads\/2019\/04\/cropped-Presentation-resize-300x78.jpg 300w, https:\/\/commerceiets.com\/wp-content\/uploads\/2019\/04\/cropped-Presentation-resize-768x199.jpg 768w, https:\/\/commerceiets.com\/wp-content\/uploads\/2019\/04\/cropped-Presentation-resize-1536x398.jpg 1536w, https:\/\/commerceiets.com\/wp-content\/uploads\/2019\/04\/cropped-Presentation-resize.jpg 1920w\" sizes=\"(max-width: 1024px) 100vw, 1024px\" \/><figcaption>LAW OF INCREASING RETURNS<\/figcaption><\/figure>\n","protected":false},"excerpt":{"rendered":"<p>LAW OF INCREASING RETURNS The law of Increasing Returns is also known as the&nbsp;Law of Diminishing Costs.&nbsp;According to this law when more and more units of variable factors are employed while other factors are kept constant, there will be an increase of production at a higher rate. This law is applicable to all different industries&#8230;<\/p>\n<p class=\"more-link-wrap\"><a href=\"https:\/\/commerceiets.com\/law-of-increasing-returns\/\" class=\"more-link\">Read More<span class=\"screen-reader-text\"> &ldquo;LAW OF INCREASING RETURNS&rdquo;<\/span> &raquo;<\/a><\/p>\n","protected":false},"author":2,"featured_media":3766,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"rank_math_lock_modified_date":false,"footnotes":""},"categories":[113,92],"tags":[],"class_list":["post-3761","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-managerial-economics","category-micro-economics"],"_links":{"self":[{"href":"https:\/\/commerceiets.com\/wp-json\/wp\/v2\/posts\/3761"}],"collection":[{"href":"https:\/\/commerceiets.com\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/commerceiets.com\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/commerceiets.com\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/commerceiets.com\/wp-json\/wp\/v2\/comments?post=3761"}],"version-history":[{"count":0,"href":"https:\/\/commerceiets.com\/wp-json\/wp\/v2\/posts\/3761\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/commerceiets.com\/wp-json\/wp\/v2\/media\/3766"}],"wp:attachment":[{"href":"https:\/\/commerceiets.com\/wp-json\/wp\/v2\/media?parent=3761"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/commerceiets.com\/wp-json\/wp\/v2\/categories?post=3761"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/commerceiets.com\/wp-json\/wp\/v2\/tags?post=3761"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}