For the Production Function Y = a • F(K,L) Constant

question 18

Multiple Choice

For the production function Y = A • F(K,L) constant returns to scale means:

• A)if capital and labour double output doubles.
• B)capital and labour increase at a constant rate.
• C)the marginal products of capital and labour are constant.
• D)technology is constant.

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Definitions:

Canning Department

A section within a manufacturing process focused on the preservation of food by sealing it in airtight containers.

Weighted-Average Method

An inventory costing method that calculates the cost of goods sold and ending inventory based on the average cost of all goods available for sale.

Direct Materials Cost

Direct materials cost refers to the cost of raw materials and components that are directly used in the production of a product, which are easily traceable to the finished product.

Equivalent Units

A concept used in cost accounting to express the amount of work done on in-process products in terms of complete units of output.