what is economics of scale and constant returns to scale
Returns to scale
F ( a K , a L ) = A ( a K ) b ( a L ) c = A a b a c K b L c = a b + c A K b L c = a b + c F ( K , L ) , ( \ displaystyle \ F ( aK , aL ) = A ( aK ) ^ ( b ) ( aL ) ^ ( c ) = Aa ^ ( b ) a ^ ( c ) K ^ ( b ) L ^ ( c ) = a ^ ( b + c ) AK ^ ( b ) L ^ ( c ) = a ^ ( b + c ) F ( K , L ) , )
F ( a K , a L ) = A ( a K ) b ( a L ) c = A a b a c K b L c = a b + c A K b L c = a b + c F ( K , L ) , ( \ displaystyle \ F ( aK , aL ) = A ( aK ) ^ ( b ) ( aL ) ^ ( c ) = Aa ^ ( b ) a ^ ( c ) K ^ ( b ) L ^ ( c ) = a ^ ( b + c ) AK ^ ( b ) L ^ ( c ) = a ^ ( b + c ) F ( K , L ) , )