A Constant Elasticity Cost Function
A) Takes a Form Such $T C = w L + r K$

question 15

Multiple Choice

A constant elasticity cost function

• A) takes a form such as TC = a Q^b w^c r^d and is useful in empirical work because it can be converted into a linear form using logarithms.
• B) takes a form such as \(T C = w L + r K\) , where L and K are chosen to minimize cost, and w and r are input prices.
• C) takes a form such as TC = a Q² + KL.
• D) is given by TC = AC x Q.

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