Explain the Term "Constant Returns to Scale

question 15

Essay

Explain the term "constant returns to scale." Define the term "diminishing marginal returns".Can a production function exhibit both of these properties?

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Definitions:

Principle of Utility

A fundamental concept in utilitarian ethics that suggests actions should be judged as right or wrong based on their outcomes, specifically their ability to produce the greatest happiness for the greatest number of people.

Greatest Happiness

A principle that suggests the best action is the one that maximizes happiness or pleasure for the greatest number of people.

Associated Pleasure

The enjoyment or satisfaction derived from a particular activity, object, or association.

Work Ethic

The belief in the moral benefit and importance of work and its inherent ability to strengthen character.