Does This Production Function,q = 10L⁰

question 123

Multiple Choice

Does this production function,q = 10L^0.5K^0.3,experience increasing,decreasing or constant returns to scale?

• A) Decreasing because a 100% increase in inputs increases outputs by 80%.
• B) Increasing because an 80% increase in inputs increases outputs by 100%.
• C) Decreasing because 0.5 + 0.3 < 1.
• D) A and C.

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Definitions:

Takeoff

The phase in a company's or product's life cycle where growth becomes rapid and significantly visible.

No Single Stage

The concept that processes or developments do not occur in one step but rather progress through multiple phases or stages.

Growing Pains

Challenges or difficulties experienced by a company or organization due to rapid growth, expansion, or changes.

Jobs Not Delivered

A situation where agreed-upon work or duties have not been completed or provided.