A production function changes from 40Q = f(2L, 3K) to 50Q = f(2L, 5K), where K is capital and L is labour. The fixed factor in this case is/are .

capital

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labour

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capital & labour

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neither K nor L

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Solution

The correct option is B labour
Since output has increased with no change in labour units employed, it indicates that labour is the fixed factor.

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