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    Microeconomics Theory with Applications
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    Exam 7: Production Cost: Many Variable Inputs
  5. Question
    Suppose Diane's Spa Operates with the Production Function Y =
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Suppose Diane's Spa Operates with the Production Function Y =

Question 23

Question 23

Multiple Choice

Suppose Diane's spa operates with the production function y = (1200z1z2) 2/3. Diane's production function exhibits


A) scale production cannot be determined
B) constant returns to scale
C) increasing returns to scale
D) decreasing returns to scale

Correct Answer:

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