Constant returns to scale implies that if N and K both increase by 3% that
A) output (Y) will increase by 3%.
B) Y/N will increase by 3%.
C) Y/N will increase by less than 3%.
D) the capital-labor ratio will increase by 3%.
A
Economics
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Ernie's Earmuffs produces 200 earmuffs per year at a total cost of $2,000 and $400 of this cost is fixed. If he increases output to 220 earmuffs, his total cost increases to $2100, and his fixed cost remains $400. What is Ernie's marginal cost per earmuff?
A) $105 B) $35 C) $9.55 D) $5
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Explain the three distinct notions of openness
What will be an ideal response?
Economics