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1. Is it possible for a firm to experience both increasing and diminishing returns at the same time? 2. What other firms, in other industries,

1. Is it possible for a firm to experience both increasing and diminishing returns at the same time?

2. What other firms, in other industries, might be in similar situations to Microsoft, and in what respects?

3. What is the nature of the fixed factor that is causing the law of diminishing returns in Microsoft's case?

4. Are there any ways in which Microsoft can reduce the undesirable effects of the law of diminishing returns?

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