Question
Do the following production functions exhibit increasing,constant, or decreasing returns to scale? (show your work toillustrate the answer), where Q is quantity of output, K
Do the following production functions exhibit increasing,constant, or decreasing returns to scale? (show your work toillustrate the answer), where Q is quantity of output, K is theamount of capital used, and L is the amount of labor used.
a) Q=K^1/3 L^2/3
b) Q=7K^1/5 L^3/5
c) Q=4K+8L
d) Q=3k^5 L^4
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Economics of Money, Banking and Financial Markets
Authors: Frederic S. Mishkin
9th Edition
978-0321607751, 9780321599797, 321607759, 0321599799, 978-0321598905
