Suppose that the production function is f(x₁, x₂) = Cxfx2 where a, b, and C are positive constants. a) For what positive values of a, b, and C are there decreasing returns to scale? constant returns to scale? increasing returns to scale? For what positive values of a, b, and C is there decreasing marginal product for factor 1? c) For what positive values of a, b, and C is there diminishing technical rate of substitution? b)

Managerial Economics: Applications, Strategies and Tactics (MindTap Course List)
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Author:James R. McGuigan, R. Charles Moyer, Frederick H.deB. Harris
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Chapter7: Production Economics
Section: Chapter Questions
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Need help with part b and c

Suppose that the production function is f(x₁, x₂) = Cxx2 where a, b, and C are positive constants.
a) For what positive values of a, b, and C are there
decreasing returns to scale?
constant returns to scale?
increasing returns to scale?
For what positive values of a, b, and C is there decreasing marginal product for factor 1?
c)
For what positive values of a, b, and C is there diminishing technical rate of substitution?
b)
Transcribed Image Text:Suppose that the production function is f(x₁, x₂) = Cxx2 where a, b, and C are positive constants. a) For what positive values of a, b, and C are there decreasing returns to scale? constant returns to scale? increasing returns to scale? For what positive values of a, b, and C is there decreasing marginal product for factor 1? c) For what positive values of a, b, and C is there diminishing technical rate of substitution? b)
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