Suppose the production of mp3 players can be represented by the following production function: q = L0.4K0.4. Which of the following statements is TRUE?
A) The production function has decreasing returns to scale.
B) The production function has increasing returns to scale.
C) The production function has constant returns to scale.
D) Returns to scale vary with the level of output.
A
You might also like to view...
A speculative bubble causes
a. current prices to sink artificially low. b. current prices to rise artificially high. c. no current price changes, only possible future changes. d. undervaluing of stock prices.
Which of the following statements is true?
a. A company can manipulate uncontrollable factors to increase the demand for its product b. A company can manipulate uncontrollable factors to increase the supply of its product c. A company cannot manipulate uncontrollable factors to increase the demand for its product d. A company cannot manipulate controllable factors to increase the demand for its product
Given the value of marginal product of labor, the higher the wage rate, the higher the number of workers employed
Indicate whether the statement is true or false
Carbon dioxide emissions are thought to contribute to global warming, and there is a concern that changes in climate will be costly. Emitting carbon dioxide is an example of:
A. an effluent fee. B. a public good. C. an adverse selection problem. D. a negative externality.