A firm has the production function f(x, y)= x + min{x, y}.The isoquants for the firm
A)are L-shaped with the corners of the L's on the line y = x.
B)are L-shaped with the corners of the L's on the line y = x + 1.
C)consist of two line segments, one vertical and the other with a slope of -1.
D)consist of two line segments, one horizontal and the other with a slope of F-1.
E)are upside down L-shaped.

Question

Quizplus · Accepted Answer

This production function exhibits constant returns to scale, as doubling both inputs doubles output. Therefore, the isoquants will be linear. Note that the function contains the term "min{F(x,y),F}", which means that the isoquants will be L-shaped. Specifically, because the vertical axis is y F1F1F1S1F1F1F10 x F1F1F1S1F1F1F10 1, the L-shape will consist of one vertical line segment and one with a slope of F1F1F1S1F1F1F101.

A Firm Has the Production Function F(x, Y)= X