Under Certain Circumstances,the Production Function Y = AF(K,N)can Be Rewritten

question 22

Multiple Choice

Under certain circumstances,the production function Y = AF(K,N) can be rewritten as Y = ANF(K,N) .In this case,suppose that both K and N double.What happens to output?

• A)It remains unchanged.
• B)It is reduced by one half.
• C)It is increased by a factor of 4.
• D)It doubles.

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Definitions:

Regression Analysis

A statistical approach used to model and analyze the relationship between a dependent (target) variable and one or more independent variables.

Dependent Variable

The variable that is measured in an experiment and expected to change as a result of changes in the independent variable.

Continuous Variables

Variables that can take an infinite number of values within a given range, allowing for very fine distinctions.

Factor Analysis

An analytical method in statistics that identifies the basic variables, or factors, explaining the correlation patterns seen within a group of observed variables.