home > Sample Assignment > Economics Homework Assignment > Manufacturer Production Function

Manufacturer Production Function Sample Assignment

QUESTION: Suppose an automobile manufacturer is choosing between two production options.
It can produce 100 cars with 200 workers and 50 machines, or it can produce 166
cars with 300 workers and 75 machines. Would you describe the manufacturer
production function as exhibiting decreasing, constant, or increasing returns to scale?
Explain.

 

ANS: Company can produce 100 cars with 200 workers and 50 machines
Company can produce 166 cars with 300 workers and 75 machines

%Increase in workers= 300-200/200x100= 50%
%Increase in machines= 75-50/50x100= 50%
%Increase in output= 166-100/100x100= 66%

This is a clear case of increasing returns to scale as %increase in output is more than the %increase in inputs.

 

Other Sample Assignments in Economics Homework Assignment :

Manufacturer Production Function	Price Elasticity Of Supply
Equalization Of Wages	Equilibrium Price Of Commodity
Poverty In India	Gross National Product
Consumption At Different Levels	Gross Domestic Product
Investment Decision	Expected Raturn
Level Of Income	Saving Equation
Equilibrium Level of Income	Equilibrium Level of National
Equilibrium GDP	Equilibrium level of GDP
Autonomous Investment	Calculate The Equilibrium GDP
Government Expenditure	Equilibrium Gdp Of Economy
Hypothetical Information	Equilibrium GDP Government
Equilibrium Level Of Inceome	Equation For Monetary Equilibrium
Calculate Saving Function	Equilibrim Level Of Income
Regardless Of The Level Of Income

---

---