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spacemanspliff spacemanspliff
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A year ago
Scenario: Assume the following aggregate production functions for two countries, A and B, respectively.
YA = A KA1/2 HA1/2
YB = A KB2/3 HB1/3


Refer to the scenario above. What is TRUE about the aggregate production functions?

▸ Country B's production function has higher returns to scale.

▸ Country A's production function has higher returns to scale.

▸ Both countries' production functions have constant returns to scale.

▸ Both countries' production functions have equal returns to increases in K and H.
Textbook 
Macroeconomics

Macroeconomics


Edition: 3rd
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boomers1234boomers1234
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A year ago
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spacemanspliff Author
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A year ago
I appreciate what you did here, answered it right Smiling Face with Open Mouth
Helpmeplease11
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Yesterday
Smart ... Thanks!
smdavis
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2 hours ago
Helped a lot
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