Under what conditions do the following production functions exhibit decreasing, constant, or increasing returns to scale? a.

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Under what conditions do the following production functions exhibit decreasing, constant, or increasing returns to scale?

a. q = L + K, a linear production function,

b. q = AL^aK^b, a general Cobb-Douglas production function,

c. q = L + L^aK^b + K,

d. q = (aL^ρ + [1 – a]K^r)^d/^ρ, a CES production function?

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Microeconomics Theory and Applications with Calculus

ISBN: 978-0133019933

3rd edition

Authors: Jeffrey M. Perloff

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Question Posted: Sep 21, 2024 05:17 AM

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Under what conditions do the following production functions exhibit decreasing, constant, or increasing returns to scale? a.

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a This production always displaysconstant return to scale b The CobbDouglas production fun...View the full answer

Microeconomics Theory and Applications with Calculus

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