A Linear Specification, Q = AK + BL, Is Not

question 46

Multiple Choice

A linear specification, Q = aK + bL, is not appropriate for estimating a production function because

• A) the marginal products of the inputs are constant.
• B) it does not allow the firm to substitute capital for labor.
• C) the firm could produce positive levels of output at zero cost.
• D) both b and c
• E) all of the above

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Definitions:

Mechanical Energy

The sum of potential and kinetic energy associated with the motion and position of an object.

Thermal Energy

The internal energy present in a system due to its temperature, primarily resulting from the kinetic energy of its particles.

Chemical Energy

The potential of a chemical substance to undergo a transformation through a chemical reaction to transform other chemical substances.

Ambiguous Figures

Images or objects that can be perceived in more than one way, illustrating the subjective nature of perception.