Which of the following production functions exhibit decreasing returns to scale? In each case y is output and K and L are inputs. Select one: a. y= 3K1/2L1/2 b. y= 2K+3L. Oc. y=K12L2/3 O d. y=K05L0.25

Which of the following production functions exhibit decreasing returns to scale? In each case y is output and K and L are inputs. Select one: a. y= 3K1/2L1/2 b. y= 2K+3L. Oc. y=K12L2/3 O d. y=K05L0.25

ENGR.ECONOMIC ANALYSIS

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Chapter1: Making Economics Decisions

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Concept explainers

Factors of Production

Factors of production – in simple words means the factors that are used for producing any product or service. This includes the resources which are necessary for the manufacturing of products. Factors of production are also known as the building blocks of the economy.

Question

Which of the following production functions exhibit decreasing returns to scale? In each case y is output
and K and L are inputs.
Select one:
O a. y= 3K1/2L1/2
O b. y=2K+ 3L.
Oc y=K12L2/3
O d. y=K0.5L0.25

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