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If output is produced according to Q = ( KL) 3/4, then this production process exhibits:
a.first decreasing and then increasing returns to scale
b.first increasing and then decreasing returns to scale
c.increasing returns to scale
d.decreasing returns to scale
e.constant returns to scale
Hedge Fun is a landscaping firm that specializes in topiary. Last year, the firm had 60 employees and served 120 customers. This year, it had 70 employees and served 140 customers. The average product of labor is at a maximum when the number of customers is:
a.equal to 120
b.greater than 140
c.equal to 140
d.between 120 and 140
e.less then 120
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