When the Exponents of a Cobb-Douglas Production Function Sum to More

question 43

Multiple Choice

When the exponents of a Cobb-Douglas production function sum to more than 1,the function exhibits

• A)constant returns.
• B)increasing returns.
• C)decreasing returns.
• D)either increasing or decreasing returns.

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Definitions:

Payroll Tax Expense

The taxes that employers are required to withhold and pay on behalf of their employees, including Social Security and Medicare taxes.

State Unemployment Taxes

Taxes paid by employers to the state to fund unemployment insurance programs for workers who have lost their jobs.

Federal Unemployment Taxes

Taxes imposed by the federal government on employers to fund unemployment benefits for workers who have lost their jobs.

Gross Earnings

The total income earned by a company before deductions such as taxes and expenses.