A firm has a production function f(x, y) = 1.80(x0.10 + y0.10)2 whenever x > 0 and y > 0. When the amounts of both inputs are positive, this firm has     increasing returns to scale.   increasing returns to scale if output is less than 1 and decreasing returns to scale if output is greater than 1.   increasing returns to scale if x + y > 1 and decreasing returns to scale otherwise.   decreasing returns to scale.   constant returns to scale.

Economics For Today
10th Edition
ISBN:9781337613040
Author:Tucker
Publisher:Tucker
Chapter7: Proudction Costs
Section: Chapter Questions
Problem 15SQ
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A firm has a production function f(x, y) = 1.80(x0.10 + y0.10)2 whenever x > 0 and y > 0. When the amounts of both inputs are positive, this firm has

 
 

increasing returns to scale.

 

increasing returns to scale if output is less than 1 and decreasing returns to scale if output is greater than 1.

 

increasing returns to scale if x + y > 1 and decreasing returns to scale otherwise.

 

decreasing returns to scale.

 

constant returns to scale.

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