Which of the following production functions exhibits increasing returns to scale inthe factors of production K and L?a. y = ĀK0.3 L0.75b. y = Kª(ĀL)-e,0 < a < 1c. y = ĀKO.3L0.3d. y = ĀK/4 + L³/4

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follouring production functions exhibits increasing returns to scale in

ENGR.ECONOMIC ANALYSIS

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ISBN:9780190931919

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Chapter1: Making Economics Decisions

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Problem 1QTC

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Question

Which of the following production functions exhibits increasing returns to scale in
the factors of production K and L?
a. y = ĀK0.3 L0.75
b. y = Kª(ĀL)-e,0 < a < 1
c. y = ĀKO.3L0.3
d. y = ĀK/4 + L³/4

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