=+A. In the short run, however, it can only change the level of labor input because it has already committed to a particular capital input level for the coming months. Assume that the firm’s homothetic production process is one that has initially increasing but eventually decreasing returns to scale, and that the marginal product of each input is initially increasing but eventually decreasing. (The full production frontier would then look something like what we have plotted in Graph 12.16.)