Matt invests in a barber shop franchise. Rob's production function is given by q= K1/4 * L3/4
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Question:
Matt invests in a barber shop franchise. Rob's production function is given by
q= K1/4 * L3/4
where K is the number of hair dryers and L is the number of labor hours he employs
1) Does Matt's production function exhibit increasing, constant or decreasing returns to scale. Explain
2) Keeping the number of hair dryers constant, is the marginal product of labor increasing, constant or decreasing as more labor is used?
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