Which of the following production functions does NOT exhibit constant returns to scale? a. Y = (L^1/2)*(K^1/2) O b. Y=KL O c. All of the other choices exhibit constant returns to scale. O d. Y = 2K + 2L
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- What is the difference between economies of scale, constant returns to scale, and diseconomies of scale?True or False: The shape of the production function reflects the law of increasing marginal returns. O True O False3. Many production functions have a property called constant returns to scale, about constant returns to scale，which of the following is WRONG? A. This property implies that as all inputs are doubled, output will exactly double. B. This implies that must be true C.This also means that if we want to examine output per worker we could set x = 1/L and we would get D. None of the above is true
- Which of the following statements are true regarding the concept of returns to scale? [Check all that apply] A. If a firm doubles its inputs and output more than doubles, that would be considered increasing returns to scale. B. If a firm doubles its inputs and output doubles, that would be considered increasing returns to scale. C. If a firm doubles its inputs and output falls, that would be considered decreasing returns to scale. D. If a firm doubles its inputs and output increases by 1.5 times, that would be considered decreasing returns to scale.Please no written by hand and no image Suppose that the production function is given by Y=AK0.4N0.6. What is the percentage change in output if both capital and labor rise by 42%? Write the answer in percent terms with up to two decimals (e.g., 10.22 for 10.22%, or 2.33 for 2.33%).Returns to scale in production: Do the following production functions exhibitincreasing, constant, or decreasing returns to scale in K and L? (Assume Ais some fxed positive number.)(a) Y = K1/2L1/2(b) Y = K2/3L2/3(c) Y = K1/3L1/2(d) Y = K + L(e) Y = K + K1/3L1/3 (f ) Y = K 1/3L2/3 + A (g) Y = K 1/3L2/3 − A
- 3.ConsiderthsCobb-Dougas production function：Y=K"L".What does this function exhibit? a.Diminishing returns to scale b.Increasing returns to scale C.Constant returns to scale d.None of the aboveThe economy's aggregate production function is given by: Y = AK + BL Where A and B are constant parameters while K and L denote, respectively, the economy's stock of capital and labour. a)What are the properties of the production function? Does it display constant returns to scale? Is it increasing in the input factors? Does it display decreasing marginal returns? How do the properties of this production function compare to the more 'traditional' Cobb-Douglas production function? b)Suppose that in the economy markets are perfectly competitive. The government claims that in the economy the value of total output is fully shared between capital and labour. Is the government correct? c)Assuming perfect competition in all markets where workers are paid a wage W and the rental rate of capital is R, what is the expression for the share of GDP accruing to labour, that is WL/PY. How does this expression differ from what you would obtain if the aggregate production function were Cobb-Douglas?6. Which of the following are true (check all that apply) Note: IRTS=increasing returns to scale, CRTS=constant returns to scale, DRTS=decreasing returns to scale a. if the production function exhibits IRTS, then the cost function will exhibit economies of scale b. if the production function exhibits IRTS, then the cost function will exhibit diseconomies economies of scale c. if the cost function exhibits diseconomies of scale, then the producing function exhibits DRTS d. if the production function exhibits CRTS, then the cost function will exhibit constant economies of scale e. if the production function exhibits DRTS then the cost function will exhibit diseconomies of scale
- For the following production function: Y(K,L)= 25(KL)^(1/2) a) Compute the MRTS b) Define if it exhibits increasing, constant, or decreasing returns to scale c) Is the MRTS decreasing, increasing or constant as we increase the labor input? Provide numerical evidences and an economic interpretation of your answer d) Compute again the MRTS for this new production function: Y(K,L)= 2K+5L e) Compare now the MRTS of the two production functions and explain why the second case is a special case of the general result obtained at point a).For the production function Qs = K0.4L0.1 find the returns to scale, recall that a doubling of inputs that doulbes output is a CONSTANT returns to scale = 1.0 Please enter your response as a positive number with 1 decimal and 5/4 rounding (e.g. 1.15 = 1.2, 1.14 = 1.1).Suppose that a production function for labor (L) and capital (K) is given by: q(L,K) = L K0.2 . Does this production function exhibit constant, increasing, or decreasing returns to scale? A. Increasing returns to scale B. Constant returns to scale C. Decreasing returns to scale
