Question
1. [2.5 marks] Consider the following CES production function defined on x1 >0 and x2 >0 = (1, 2 ) = [0.31 2 + 0.72
1. [2.5 marks] Consider the following CES production function defined on x1 >0 and x2 >0 = (1, 2 ) = [0.31 2 + 0.72 2 ] 1/2 a. Find the expression for the MRTS, and show that isoquants are strictly convex to the origin b. Using the concepts of determinants to show that is quasiconcave.
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Essentials of Econometrics
Authors: Damodar Gujarati, Dawn Porter
4th edition
73375845, 978-0071276078, 71276076, 978-0073375847
