QUESTION 33 Which of the following production functions exhibits constant return
ID: 1140761 • Letter: Q
Question
QUESTION 33 Which of the following production functions exhibits constant returns to scale? 1828 14 3/4 e. All of these answers are correct QUESTION 34 If the production function is given by y-x12 and K-27 and L-8, total output equals Ob. 18 . 12 e. None of these answers are correct. QUESTION 35 A firm's profit is simply defined as a. zero o b. the price of output minus labor costs c. revenues plus costs d. revenues minus costs e. the price of output minus labor costs minus capital costs QUESTION 36 Who won the "Bet the Planet wager? O a. Donald Trump o b. Ronald Reagan c. Julian Simon d. Paul EhrlichExplanation / Answer
33) For a cobb douglas production function to exhibit constant returns to scale it is required that the the sum of power indices of K and L should be equal to 1. Here all the options from (a) to (d) satisfy this criterion and so the correct answer is option (e) that is all the above exhibit Constant returns to scale.
34) In order to find the output level Y, we substitute K=27 and L=8 into the production function Y=K^(1/3)*L^(2/3)
Y=27^(1/3)*8^(2/3)=3*4=12
Thus the correct answer is option (c) Y=12
35) A firms's profit is defined as Revenue minus costs.
Thus the correct answer is option (d)
36) The correct answer is option (c) , it was Julian Simon who won the bet and he defeated Paul Ehrlich in the bet.