A production function may exhibit
A)constant returns to scale and diminishing marginal productivities to all inputs.
B)constant returns to scale and diminishing marginal productivities to all but one input,but at least one input must have a constant marginal productivity.
C)constant returns to scale and diminishing marginal productivity to at most one input.
D)constant returns to scale and diminishing marginal productivities for no inputs.

Question

Quizplus · Accepted Answer

A production function can exhibit constant returns to scale, meaning that if all inputs are increased by a certain percentage, output increases by the same percentage, while also having diminishing marginal productivities for all inputs, which means that adding an additional unit of any input will result in a smaller increase in output.

A Production Function May Exhibit