2. (Production Function) Suppose you have a production function: Y = 10K¹/21¹/2 K represents the units of capital employed at production. L is the number of labor hours (a) Prove what are the returns of scale for this production function? (b) Which input is more productive? (Capital, Labor, or indifferent) Why? (c) What is MPK and MPL? Can you draw graphs? (d) What is "per person" version of production function? (y=Y/L, k=K/L)

2. (Production Function) Suppose you have a production function: Y = 10K¹/21¹/2 K represents the units of capital employed at production. L is the number of labor hours (a) Prove what are the returns of scale for this production function? (b) Which input is more productive? (Capital, Labor, or indifferent) Why? (c) What is MPK and MPL? Can you draw graphs? (d) What is "per person" version of production function? (y=Y/L, k=K/L)

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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2. (a) By clearly distinguishing between fixed and variable factor of production, define thelaw of diminishing returns. (b) Using ONE clearly labelled diagram, illustrate the following: AverageVariable cost, Average Total Cost, Average Fixed Cost and Marginal Cost.
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[Item-1] Instruction: (refer to the photo below) Kindly answer the question given and provide correct and complete solution. I will dislike your solution if it is incomplete and wrong answer.