According to the chief engineer at the Zodiac Company, Q = AL K, where Q is the

Question:

According to the chief engineer at the Zodiac Company, Q = ALα Kβ, where Q is the output rate, L is the rate of labor input, and K is the rate of capital input. Statistical analysis indicates that α = 0.8 and β = 0.3. The firm's owner claims the plant has increasing returns to scale.
a. Is the owner correct?
b. If ß were 0.2 rather than 0.3, would she be correct?
c. Does output per unit of labor depend only on α and β? Why or why not?