If there are constant returns to scale,the production function can be written as
A)xY = 2xAF(L,K,H,N).
B)Y/L = A F(xL,xK,xH,xN).
C)Y/L = A F( 1,K/L,H/L,N/L).
D)L = AF(Y,K,H,N).

Question

Quizplus · Accepted Answer

Constant returns to scale imply that if all inputs are increased by a certain factor, output increases by the same factor. The expression Y/L = A F(1, K/L, H/L, N/L) reflects this by showing output per worker as a function of capital, human capital, and natural resources per worker, which is consistent with constant returns to scale.

If There Are Constant Returns to Scale,the Production Function Can