2. A production function is given by the equation Q = 100L04K0.6 Where L is the number of labour units and K the capital units. a. Find marginal product of labour (Q₁) at L=4 and K=10. Interpret the result. b. Find the partial elasticity with respect to labour (EQL = at L-4 and K-10. ƏL Q Interpret the result. C. When Q-200, the marginal rate of technical substitution at L=4 is -0.21. Interpret that value (MRTS).
2. A production function is given by the equation Q = 100L04K0.6 Where L is the number of labour units and K the capital units. a. Find marginal product of labour (Q₁) at L=4 and K=10. Interpret the result. b. Find the partial elasticity with respect to labour (EQL = at L-4 and K-10. ƏL Q Interpret the result. C. When Q-200, the marginal rate of technical substitution at L=4 is -0.21. Interpret that value (MRTS).
Economics (MindTap Course List)
13th Edition
ISBN:9781337617383
Author:Roger A. Arnold
Publisher:Roger A. Arnold
Chapter17: Economic Growth: Resources, Technology, Ideas And Institutions
Section17.2: A Production Function And Economic Growth
Problem 4ST
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![2.
A production function is given by the equation
Q = 100L04K0.6
Where L is the number of labour units and K the capital units.
a.
Find marginal product of labour (Q₁) at L=4 and K=10. Interpret the result.
aQ L
at L=4 and K-10.
ƏL Q
b.
Find the partial elasticity with respect to labour (EQL
=
Interpret the result.
C.
When Q-200, the marginal rate of technical substitution at L=4 is -0.21.
Interpret that value (MRTS).](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Fa6e4e5fd-c65f-4f87-baf5-107beea50a33%2Fece1d6f2-f3b1-4eb0-a611-27f5c98f12b7%2F2q31yzm_processed.jpeg&w=3840&q=75)
Transcribed Image Text:2.
A production function is given by the equation
Q = 100L04K0.6
Where L is the number of labour units and K the capital units.
a.
Find marginal product of labour (Q₁) at L=4 and K=10. Interpret the result.
aQ L
at L=4 and K-10.
ƏL Q
b.
Find the partial elasticity with respect to labour (EQL
=
Interpret the result.
C.
When Q-200, the marginal rate of technical substitution at L=4 is -0.21.
Interpret that value (MRTS).
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