The only remaining commodity is labor which is assumed to be homogeneous in quality throughout the labor force. 2.0 Technical Data Production possibilities are taken as given.
All production processes require a year to complete.
All inputs of iron and tin are totally consumed in each production process in which they are used. They exhibit constant returns to scale and decreasing returns to each factor. Linear combinations of such production processes can be used to approximate continuous differential Neoclassical production functions, although the behavior of models with continuous production processes exhibits important differences from those with linear combinations of fixed coefficient processes. The next step is to consider the quantity flows that would arise in a stationary state. For the sake of argument, suppose the net yearly output of the economy is 100 bushels corn.