CUET Preparation Today
From the following which production function exhibits increasing returns to scale? |
$f(tx, ty)> t.f(x, y)$ $f(tx, ty) < t.f (x, y)$ $f(tx, ty)= t.f (x, y)$ $x^αy^β$ |
$f(tx, ty)> t.f(x, y)$ |
The correct answer is Option (1) → $f(tx, ty)> t.f(x, y)$ $f(tx_1, tx_2) = t.f (x_1, x_2)$ = Constant Returns to Scale $f(tx_1, tx_2) < t.f (x_1, x_2)$ = Decreasing Returns to Scale $f(tx_1, tx_2) > t.f (x_1, x_2)$ = Increasing Returns to Scale |
