Question: Can the Cobb- Douglas production function be used to portray a production process in which returns to scale are increasing at low output levels and

Can the Cobb- Douglas production function be used to portray a production process in which returns to scale are increasing at low output levels and are constant or decreasing at high output levels?

Step by Step Solution

★★★★★

3.36 Rating (165 Votes )

There are 3 Steps involved in it

1 Expert Approved Answer

Step: 1 Unlock

Take the CobbDouglas production function of the form Q F KL ... View full answer

Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock

Step: 3 Unlock

Document Format (1 attachment)

363-B-E-M-E (3601).docx

120 KBs Word File

Students Have Also Explored These Related Economics Questions!

A monopoly has a Cobb Douglas production function per hour Q (K, L) = K^1/3 L^1/3. The cost of capital (rent) is $27 per hour and the cost of labor (wage) is $8 per hour. Moreover, this firm has a...

A closed gaseous system undergoes a reversible process in which 30 kJ of heat is rejected and the volume changes from 0.14 m 3 to 0.055 m 3 The pressure is constant at 150 kPa. Determine (a) the...

Can a fixed-proportions production function exhibit increasing or decreasing returns to scale? What would its isoquant map look like in each case?

3. Can the Cobb-Douglas production function be used to portray a production process in which returns to scale are increasing at low output levels and are constant or decreasing at high output levels?

2. Consider the following Cobb Douglas production function: F(K, L) = 10 K 0.4 0.6 a) (4 Points) Determine whether the production function has constant, decreasing, or increasing returns to scale. b)...

Explain in short details please 54. If TR is 75Q - 4Q-, MR is: (a) 75 (b) 75 -8Q (c)75 Q -4 (d) None of these 55. Given TC = Q' + 7Q + 23, what is 2Q + 7: (a) AC (b) minimum TC (c) maximum TC (d) MC...

Properties of the Cobb-Douglas Production Func- tion Suppose iPhones are produced using three inth factors combined in a Cobb- Douglas production function Q : KGLEILCS where K is capital and LU and...

I appreciate your help Properties of the Cobb-Douglas Production Func- tion Suppose iPhones are produced using three inth factors combined in a Cobb- Douglas production function Q : KGLEILCS where K...

Question 1 Question 1. Consider a firm that can produce its output q using a Cobb- Douglas production function f: R} 9 R where q = f(z1,22) = A212/522V5 where Z1, 22 are net inputs in the production...

A) Given a Cobb - Douglas production function Q = 150K0.5L 0.5 , show that when the average product of labour (APL) is at a maximum it is equal or identical to the marginal product of labour (MPL)....

What is these concepts mean - about HRM 14. Internal factors affecting total rewards 17. Traditional job analysis vs competency 21. Yield ratio 22. Sequential selection system 30. Eight core...

An asset with a first cost of $9000 is depreciated by MACRS over a 5-year recovery period. The CFBT is estimated at $10,000 for the first 4 years and $5000 thereafter as long as the asset is...

You purchased a stock at a price of $ 4 8 7 4 . The stock paid a dividend of $ 1 9 1 per share and the stock price of the end of the year is $ 5 4 7 9 Whet was the dividend yield?

Are the industrys products standardized or undifferentiated?

If bottles sell for 35 cents each, how many bottles should the company described in Table 6.2 produce each day? Data from Table 6.2 TABLE 6.2 Fixed, Variable, and Total Costs of Bottle Production...

Which of the following factors would affect a buyers reservation price for a given good or service: social influence, the price of the good, or the cost of producing the item?

For the supply curve shown in Figure 4.14, calculate the elasticity of supply when P = 6. Data from Figure 4.14 FIGURE 4.14 A Supply Curve for Which Price Elasticity Declines as Quantity Rises. For...

Quilcene Oysteria farms and sells oysters in the Pacifio Northwest. The company horvested and sold 7,200 pounds of oysters in August. The company's flexible budget for August appears below: The...

1. Again, the chickenegg problem! A chicken lays a number of eggs, N, which follows a Poisson[)\\) distribution. Each egg hatches a chick with probability 33, independently. Let X be the number of...

Assume Evco, Inc. has a current stock price of $45.37 and will pay a $1.95 dividend in one year; its equity cost of capital is 15%. What price must you expect Evco stock to sell for immediately after...