Which of the following production functions exhibits constant returns to scale? A) q = KL B) q = KL^0.5 C) q = K + L D) q = log(KL)

Question

Quizplus · Accepted Answer

The production function q = K + L exhibits constant returns to scale because if both inputs are doubled, the output will also double. This can be seen by observing that (2K) + (2L) = 2(K + L), which means that doubling the inputs doubles the output. The other production functions do not exhibit constant returns to scale.

Which of the Following Production Functions Exhibits Constant Returns to Scale