Use the following to answer questions :
Table 6-1
-Suppose that production were given by the function recorded in Table 6-1 above.For that schedule to display decreasing returns to scale, the total product associated with 6 units of labor and 40 units of land would have to be:
A)115.
B)117.
C)119.
D)121.
E)125.

Question

Use the following to answer questions :
Table 6-1 
-Suppose that production were given by the function recorded in Table 6-1 above.For that schedule to display decreasing returns to scale, the total product associated with 6 units of labor and 40 units of land would have to be:
A)115. 
B)117. 
C)119. 
D)121. 
E)125.

Quizplus · Accepted Answer

Decreasing returns to scale occur when an increase in inputs leads to a less than proportional increase in output. If the total product for 6 units of labor and 40 units of land is 115, it suggests that adding more inputs (labor and land) results in a smaller increase in output, indicating decreasing returns to scale.

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