Question

[9] Suppose a firm produces according to the following production function: Q-KOL, where is the quantity produced, K is the amount of capital employed, and L is the number of workers employed. Accordingly, this firm operates under_returns to scale. A. B. increasing decreasing constant

Answer 1

constant returns to scale.

Returns to scale ac lends on to when we change, The factors of production how The Production Changes. for example if we double the factor of productions and output gets to scale - more than Increasing returns double - to decreasing returns scale - Less than double = - quel double - To Scale Constant returns So given G = KOL Let to more specific t=2 9 CK, CJ = KOL 9C2K, 2C) = (2K)-(24) - 2 (K&L) = 29 (KIC) Q (2K, 2C) = 29 So Boublong The Botnoy factors result in double of oft =) CRS.

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