<p>"Most likely" is not a precise term.</p>

<p>Given the available information it is quite possible that an equilibrium does not exist. In that case we can't really tell what will happen.</p>

CC BY-SA 3.0
2017-12-15T21:42:27.250Z
2017-12-15T21:42:27.250Z
Giskard
<p>If there are increasing returns to scale in both sectors (in a 2x2x2x2) production and consumption economy, then a profit maximizing allocation most likely involves the economy producing only one type of good?</p>

<microeconomics><competitive-equilibrium>
Relationship between IRS and Competitive equilibrium
Ryan
# Relationship between IRS and Competitive equilibrium

(Asked by: username_0 on 2017-12-15)

If there are increasing returns to scale in both sectors (in a 2x2x2x2) production and consumption economy, then a profit maximizing allocation most likely involves the economy producing only one type of good?

**Tags:** microeconomics, competitive-equilibrium


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## 1 answers

### Answer by username_1 on 2017-12-15. Score: 2

"Most likely" is not a precise term.

Given the available information it is quite possible that an equilibrium does not exist. In that case we can't really tell what will happen.


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