Afarmer uses t units of landand l hours of labor to produce c tons of corn, with the following production function c = l3/4t. suppose the amount of land, t, is fixed, that is the farmer cannot use more land. this production function exhibits
a. increasing returns to labor.
b. constant returns to labor.
c. diminishing returns to labor.
d. no clear pattern of returns to labor.

Option (C) is correct.

Explanation:

Land is a fixed and cannot be changed, so it is like a scenario of short run production, this is because all of the inputs that are used for the production of goods and services cannot be changed.

Therefore, the increasing returns to scale, constant returns to scale and decreasing returns to scale will not be applied here.

In short run, diminishing return to labor is achieved in the production at the firm level.

At equation if k unit of labor is increased, then:

Now, if there is an increase in the labor by k units then as a result output only increases by units.

It shows the condition of diminishing return to labor.

hi,

henry is an economist and wants to understand the relationship between inflation and consumer spending habits. for his research, he needs the consumer price index for 2014 and the inflation rate. based on the prices of goods given, what will he find to be the cpi and inflation rate for 2014? assume that a consumer’s basket for three consecutive years consists of the following:

you dont privide answer choices.

answer - 15% of a inflatation rate is 15% less in cpi