Consider the Production Function

question 1

Multiple Choice

Consider the production function
For this function to have diminishing marginal productivities and increasing returns to scale,it must be the case that:

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Definitions:

Normal Markup

The standard increase over cost that a business applies to its products or services to determine the selling price.

Common Stock

A form of corporate equity ownership, a type of security that represents ownership in a corporation and a claim on a proportion of its profits.

Gain Recognition

The process of recording increases in asset value, typically when assets are sold for more than their book value.

Consolidated Income Statement

A financial statement that combines the income, expenses, and profits of a parent company and its subsidiaries to present the overall performance.