Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Macro q1 thank you A representative rm which only can survive for one period. It has the following technology: Y = zF(K, N ), where

Macro q1 thank you

image text in transcribed
A representative rm which only can survive for one period. It has the following technology: Y = zF(K, N ), where K is the given capital stock (the representative rm owns K but no market value if the rm sells it), N is labor demand by paying competitive market wage rate to, and z is total factor productivity (TFP). Let's further assume the production function be a continuous concave function. Without loss of generality, let's assume the output good price equals to 1. (a) Write down the representative rm's prot function and graphically determine and mathe- matically prove the prot maximization coudition. (8 marks) (b) Determine the labor demand curve, N, as a function of wage, 1:). Graph this relationship. (6 marks) (0) Suppose that the pandemic improves technology due to the improving remote work-from-home technology that save a lot of commute time. La, 2 increases. Discuss and graph the change of labor demand curve. (8 marks)

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image_2

Step: 3

blur-text-image_3

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

The Economic Development Of Latin America Since Independence

Authors: Luis Bértola, Luis Bértola

1st Edition

0191638242, 9780191638244

More Books

Students also viewed these Economics questions

Question

1. Maintain my own perspective and my opinions

Answered: 1 week ago