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Unformatted text preview: cts 0.18 0.33 0.51 1.92 Food and Kindred Products 0.43 0.48 0.91 1.09 Transportation equipment 0.44 0.48 0.92 1.08 Apparel and other textiles 0.70 0.31 1.01
(see note below) Furniture and fixtures 0.62 0.40 1.02 0.98 Electronics and electric equipment 0.49 0.53 1.02 0.98 Paper and allied products 0.44 0.65 1.09 0.91 Petroleum and coal products 0.30 0.88 1.18 0.85 Primary metal 0.51 0.73 1.24 0.86 Note: Margin of error is In this case may be considered to be “constant returns to scale” ● As
the firm will use less labor and capital to produce the same target output . In fact, you should show these
requires fewer inputs, depending on the returns to scale, a 1% increase in may reduce input use and cost by
more than, less than or equal to 1%. You should be prepared for test questions where you might be asked to work out
and . You should also work out the elasticities for the US manufacturing sectors example. ● Since labor and capital can be substituted for each other, as
you should show that: the firm will use less labor and more capital where As wages rise, the firm substitutes capital for labor but th...
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- Fall '14