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Consider an economy described by the following production function: Y = K1/3(EL) 2/3 1. Does the production function exhibits constant returns to scale in (K,L)?
Consider an economy described by the following production function: Y = K1/3(EL) 2/3 1. Does the production function exhibits constant returns to scale in (K,L)? Prove your answer. 2. Express output per effective worker as a function of capital per effective worker. (Let y = Y/ LE be output per effective worker and k = K/LE be capital per effective worker.)
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