exercise 2.4

# exercise 2.4 - 1 3 5 7 9 11 13 15 17 19 21 23 25 27 29 31...

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Lab 2 Exercise 4 Raafia Siddiqui 211098936 Comments (data view) The Cobb-Douglas Model In economy, there is a relation ship between output S, investment in labour L and investment in machinery M. It is given by the equation: S = f La_labour Ma_machinery a_labour and a_machinery are constants Total capital investment is given by: where e is a constant These equations suggest that uptput supply can be maximized by selecting appropriate values of L and M. This spreadsheet will investigate this rellationship graphically by plotting L as a function of M. S and K are parameters that will be used to maximize S. K = e L + M L = (S / ( f M a_machinery )) 1/a_labour = (K - M) / e

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Lab 2 Exercise 4 Raafia Siddiqui 211098936 Parameters (data view) Constants: Parameters: a_machinery 1 Output Supply S: 50 a_labour 1.2 Total Investment K: 60 f 0.1 e 0.75
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Unformatted text preview: 1 3 5 7 9 11 13 15 17 19 21 23 25 27 29 31 33 35 37 39 50 100 150 Cobb-Douglas Investment Model Column B Column C Investment in Machinery-M Investment in Labour-L Lab 2 Exercise 4 Raafia Siddiqui 211098936 Data (formula view) M L(S) L(K) #DIV/0! 80 2 99.61 77.33 4 55.9 74.67 6 39.87 72 8 31.37 69.33 10 26.05 66.67 12 22.38 64 14 19.68 61.33 16 17.61 58.67 18 15.96 56 20 14.62 53.33 22 13.5 50.67 24 12.56 48 26 11.75 45.33 28 11.05 42.67 30 10.43 40 32 9.88 37.33 34 9.4 34.67 36 8.96 32 38 8.56 29.33 40 8.21 26.67 42 7.88 24 44 7.58 21.33 46 7.3 18.67 48 7.05 16 50 6.81 13.33 52 6.59 10.67 54 6.39 8 56 6.2 5.33 58 6.02 2.67 60 5.85 62 5.69-2.67 64 5.55-5.33 66 5.41-8 68 5.27-10.67 70 5.15-13.33 72 5.03-16 74 4.91-18.67 76 4.81-21.33 78 4.7-24...
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## This note was uploaded on 12/15/2010 for the course CSE CSE 1520 taught by Professor Paul during the Spring '09 term at York University.

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exercise 2.4 - 1 3 5 7 9 11 13 15 17 19 21 23 25 27 29 31...

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