HWV.F08 - D ( u,x ) = x 1 1 x 2 2 u 1 1 u 2 2 . (a) What...

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HOMEWORK ECONOMICS 200A V. PRODUCER THEORY R. R. RUSSELL FALL 2008 1. The single-output production function is f ( x ) = αx β 1 1 x β 2 2 , where α , β 1 and β 2 are positive parameters satisfying β 1 + β 2 < 1. (a) Derive the cost function. (b) Derive the profit function and the supply and demand functions. 2. Suppose that the technology is represented by the distance function,
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Unformatted text preview: D ( u,x ) = x 1 1 x 2 2 u 1 1 u 2 2 . (a) What restrictions on the parameters are needed for this to be a legitimate distance function? (b) Derive the cost function. (c) Derive the prot function and the supply and demand functions....
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