Let the Production Function Be Q = AL^aK^b

question 48

Multiple Choice

Let the production function be q = AL^aK^b.The function exhibits decreasing returns to scale if

• A) a + b = 1.
• B) a + b > 1.
• C) a + b < 1.
• D) Cannot be determined with the information given.

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Definitions:

Endorphins

Naturally occurring peptides produced in the brain that act as neurotransmitters to reduce the perception of pain and promote feelings of pleasure.

Morphine

An opiate analgesic derived from the opium poppy used for pain relief.

Sympathetic Systems

A part of the autonomic nervous system responsible for the body's 'fight or flight' response to stressful situations.

Parasympathetic Systems

A branch of the autonomic nervous system responsible for conserving energy and reducing the heart rate.