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Questions › UGC-NET › UGC-NET 2024 › Q10
2 marksMicroeconomics › Production and returns to scale › Returns to scale and homogeneityHardabout 2 min

UGC-NET 2024 Question 10: Production and returns to scale

For the production function, Q=AKαLβQ = AK^{\alpha}L^{\beta}Q=AKαLβ, where A,α,β>0A,\alpha,\beta>0A,α,β>0, which of the following statement(s) are correct?
A. Degree of homogeneity is 1
B. Output elasticity with respect to capital is α\alphaα
C. It exhibits constant returns to scale
D. Marginal product of a factor = Average product of the factor Choose the correct answer from the options given below:

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Plain-text version

For the production function, Q = AK^αL^β, where A,α,β>0, which of the following statement(s) are correct? A. Degree of homogeneity is 1 B. Output elasticity with respect to capital is α C. It exhibits constant returns to scale D. Marginal product of a factor = Average product of the factor Choose the correct answer from the options given below: (A) A & B Only (B) B & C Only (C) B & D Only (D) B Only

Also written as: For the production function, Q = AK^(alpha)L^(beta), where A,alpha,beta>0, which of the following statement(s) are correct? A. Degree of homogeneity is 1 B. Output elasticity with respect to capital is alpha C. It exhibits constant returns to scale D. Marginal product of a factor = Average product of the factor Choose the correct answer from the options given below:

Production and returns to scale has come up 92 times in 6 exams since 2007.

What this question tests

This question is on Returns to scale and homogeneity, part of Production and returns to scale in Microeconomics.

How output changes when all inputs scale up, including Euler's theorem and the degree of homogeneity.

TestStop has 20 past-paper questions on this subtopic.

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Question from the UGC-NET 2024 paper. Solutions are TestStop's own. Not affiliated with or endorsed by any examination authority.