Answered step by step
Verified Expert Solution
Question
1 Approved Answer
Hello, this is an macroeconomic question. They are all relevant to the main question. Thank you! Production in the country of EconVille can be characterized
Hello, this is an macroeconomic question. They are all relevant to the main question. Thank you!
Production in the country of EconVille can be characterized by the following function: Y = 3K0 251,075 and that EconVille initially has 360 units of labor and 180 units of capital. Calculate the numerical value' marginal product of labor and marginal product of capital. Calculate the total payments to labor and capital in EconVille. Suppose that in EconVille there is mass exodus of workers leading to labor being cut in half. Briey explain what will happen to the real wage and the rental rate of capital. Briey explain what will happen to labor's share of income and capital's share of income. Now return to the original numbers (3 60 units of labor and 180 units of capital). Suppose that there is a general productivity decline in EconVille so that technology changes from A=3 to A=2. Calculate the marginal product of labor and marginal product of capital now. Compared to part a) briey explain if this productivity fall affect labor and capital the same or differentlyStep by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access with AI-Powered 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