When a firm experiences decreasing returns to scale, _____.

it should expand its scale of operations to increase production efficiency
it is on the downward-sloping portion of the long-run average total cost curve
its long-run average cost curve rises as output expands
an increase in all inputs will increase output proportionately

Explanation
If a firm experiences decreasing returns to scale, the long-run average cost curve rises as output expands. This is because, as the scale of the company increases, the average cost also increases.