A firm with decreasing returns to scale can expect to produce [a. more than, b. less than, c.exactly] 20% more output if it uses 20% more inputs. its production to decrease by ["", "", ""] 10%, if it cuts all inputs to 90% of their previous levels.
A firm with decreasing returns to scale can expect to produce [a. more than, b. less than, c.exactly] 20% more output if it uses 20% more inputs. its production to decrease by ["", "", ""] 10%, if it cuts all inputs to 90% of their previous levels.
Chapter9: Production Functions
Section: Chapter Questions
Problem 9.8P
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A firm with decreasing returns to scale can expect
- to produce [a. more than, b. less than, c.exactly] 20% more output if it uses 20% more inputs.
- its production to decrease by ["", "", ""] 10%, if it cuts all inputs to 90% of their previous levels.
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