Suppose Tariq's Body Shop Operates with the Production Function Y

question 30

Multiple Choice

Suppose Tariq's body shop operates with the production function y = (1200z₁z₂) ^1/2. Tariq's production function exhibits

• A)decreasing returns to scale
• B)scale production cannot be determined
• C)increasing returns to scale
• D)constant returns to scale

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Definitions:

Listed Property

Assets specified by the IRS that are subject to specific record-keeping and substantiation requirements, such as vehicles and computers used for business.

Business Bad Debt

Debt associated with the conduct of a trade or business that becomes worthless or uncollectible during the tax year.

Short-Term Capital Loss

A loss realized on the sale or exchange of a capital asset held for one year or less.

Completely Worthless

A term generally used to describe an asset that has lost all of its market value or has no foreseeable use or value.