Question
Consider production function f(l, k) = l 2 + k 2 (a) Evaluate the returns to scale. (b) Calculate the marginal product of labor and
Consider production function
f(l, k) = l2 + k2
(a) Evaluate the returns to scale.
(b) Calculate the marginal product of labor and the marginal product of capital.
(c) Calculate the MRTS.
(d) Does the production function exhibit diminishing MRTS?
(e) Plot the isoquant for production level q = 1.
Hint: Notice that the input mixes (1; 0) and (0; 1) are on this isoquant.
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Analyzing the Production Function fl k l k a Returns to Scale This production function exhibits increasing returns to scale Heres why If we proportion...
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started
Intermediate Microeconomics
Authors: Hal R. Varian
9th edition
978-0393123975, 393123979, 393123960, 978-0393919677, 393919676, 978-0393123968
