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A firm produces a quantity Q of a product using labor L and material M with the production function Q =40( ML)^0.5 + 0.5 M

A firm produces a quantityQof a product using laborLand materialMwith the production functionQ=40(ML)^0.5+ 0.5M+ 0.5L. The marginal product functions for this production function are:MPL= 20(M/L)^0.5+ 0.5 and MPM= 20(L/M)^0.5+ 0.5. Which statement is true?

  • A.The production has decreasing return to scale, and diminishing marginal productivities
  • B.The production has constant return to scale, and increasing marginal productivities
  • C.The production has constant return to scale, and diminishing marginal productivities
  • D.The production has decreasing return to scale and increasing marginal productivities

which option from a to D is true

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