If, when a firm doubles all its inputs, its average cost of production decreases, then production displays a. diseconomies of scaleb. economies of scalec. declining fixed costsd. diminishing returns

The correct answer is option b.

Explanation:

The doubling of inputs would increase the cost of production. It would also increase the quantity of output produced. If the average cost of production is decreasing with the increase in output level, this is an indicator of the economies of scale.

Economies of scale is the cost advantage due to large scale of production.