Consider the following production function: q= 4L+K. Which term describe this production function's returns to scale?...

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Consider the following production function: q= 4L+K. Which term describe this production function's returns to scale?...

Consider the following production function: q= 4L+K. Which term describe this production function's returns to scale? Select one: a. Constant Returns to Scale b. Increasing Returns to Scale c. Decreasing Returns to Scale

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Answer 1

Answer #1

Ans) the correct option is a. Constant Returns to Scale

Constant returns to scale occurs when an increase in inputs cause the same proportional increase in output

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Answer 2

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