Which of the following is not an assumption associated with the definition of a production function?
A) Technology remains constant.
B) Both inputs and outputs are measured in monetary units.
C) The function shows the maximum level of output possible with a given combination of inputs.
D) All units of the inputs are homogeneous.

Question

Quizplus · Accepted Answer

The production function assumes technology is constant, outputs are maximized for a given combination of inputs, and all units of inputs are homogeneous. It does not assume that inputs and outputs are measured in monetary units; instead, they are typically measured in physical quantities.

Which of the Following Is Not an Assumption Associated with the Definition