Title: Understanding Returns to Scale, Diminishing Returns, and Market Structures

Answer the below questions
1. What are increasing, decreasing and constant returns to scale?
2. Explain how the law of diminishing returns determine increasing marginal costs in the short run.
3. Provide your own real examples of perfect competitive and monopoly markets, and explain how these firms are price takers and price makers.
4. How a monopoly determines the optimum output level and optimum price? (Figure 8.11 may be useful)