Unformatted text preview: 3) If there are two factors of production, L and K , and 3 / 1 4 / 1 5 K L AP L β β
β‘ , what is the formula for ? K MP (Yes, I did mean the marginal product of capital.) 4) Suppose , 1 ) ( ) , ( / 1 β β€ + = = Ο L K L K f q a) Show that this function exhibits constant returns to scale b) Calculate L K MP MP and c) Calculate RTS L,K d) Calculate the output elasticity K q , Ξ΅ 5) Eulerβs Theorem implies that for a constant returnstoscale production function of the form ) , ( L K f q = , L f K f q L K β
+ β
= . Use this result to show that for a constant returnstoscale production function, if L L AP MP > then K MP must be negative....
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This note was uploaded on 11/30/2011 for the course STAT 380 taught by Professor Stevens during the Spring '11 term at Brigham Young University, Hawaii.
 Spring '11
 Stevens

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