he table shows the shows the quantities of labor and capital required to produce various levels of output. Quantity of Capital Quantity of Labor Output 6 2 40 12 4 100 24 8 220 48 16 440 96 32 800 When the firm increases production from 48 units of capital and 16 units of labor to 96 units of capital and 32 units of labor, the production function exhibits: increasing returns to scale. constant returns to scale. diminishing marginal returns. decreasing returns to scale.
he table shows the shows the quantities of labor and capital required to produce various levels of output. Quantity of Capital Quantity of Labor Output 6 2 40 12 4 100 24 8 220 48 16 440 96 32 800 When the firm increases production from 48 units of capital and 16 units of labor to 96 units of capital and 32 units of labor, the production function exhibits: increasing returns to scale. constant returns to scale. diminishing marginal returns. decreasing returns to scale.
Chapter6: Proudction Costs
Section: Chapter Questions
Problem 3SQP
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The table shows the shows the quantities of labor and capital required to produce various levels of output.
Quantity of Capital |
Quantity of Labor |
Output |
6 |
2 |
40 |
12 |
4 |
100 |
24 |
8 |
220 |
48 |
16 |
440 |
96 |
32 |
800 |
When the firm increases production from 48 units of capital and 16 units of labor to 96 units of capital and 32 units of labor, the production function exhibits:
- increasing returns to scale.
- constant returns to scale.
- diminishing marginal returns.
- decreasing returns to scale.
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