Answer the following questions using the production function

Answer the following questions using the production function , where

Pick your own a and b, each between 0 and 1, and then explain to me whether your assumed values give us constant, increasing, or decreasing returns to scale. Show your work.

Solution

If a + b = 1, the production function has constant return to scale

If a + b < 1, Return to scale is decreasing.

If a + b > 1, Return to scale is increasing.