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You've Been Asked by Your Manager to Choose Between the Following

question 97

Essay

You've been asked by your manager to choose between the following three production functions based on returns to scale:
Q = 10K2L1
Q = 10K0.5L0.5
Q = 10K0.25L0.5
She would like you to choose the one that exhibits increasing returns to scale and to provide evidence to support your decision.


Definitions:

Market Revolution

The dramatic increase in exchange of goods and services in the 19th century U.S., facilitated by advancements in transportation, commercialization, and industrialization.

Economic Opportunities

Prospects for participation in economic activities that can lead to employment and financial success.

Cult of Domesticity

A 19th-century ideology in the United States and Britain that glorified women's roles in home-making and child-rearing, emphasizing piety, purity, domesticity, and submissiveness.

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