If a firm increases all of its inputs by 10 percent and its output increases by 15 percent, then

A) it is encountering diseconomies of scale.
B) it is encountering economies of scale.
C) the law of diminishing returns is taking hold.
D) the firm's long-run ATC curve will be rising.

Economies of Scale

Cost advantages reaped by companies when production becomes efficient, as the scale of operation and output increases.

Diseconomies of Scale

The phenomenon when a firm experiences increased costs per unit of output due to inefficiencies associated with scale of production, contrary to economies of scale.

Long-run ATC

Referring to the average total cost of production when all inputs, including capital, are variable over a longer period.