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The output of an economic system Q, subject to two inputs, such as labor L and capital K, is often modeled by the Cobb-Douglas production
The output of an economic system Q, subject to two inputs, such as labor L and capital K, is often modeled by the Cobb-Douglas production function Q= cLaKb. When a+ b =1, the case is called constant returns to scale. 1 3 Suppose @=1594, a= 1 b= 1 and c=40. Complete parts (a) and (b). dk a. Find the rate of change of capital with respect to labor, P First substitute the given values of @, a, b, and into the production function. 1 1594=40L* K* | (Type an equation.) | Lo Find n I dk - b. Evaluate the derivative in part (a) with L=16 and K=54. dK dL =| - 1.125| (Type an integer or a simplified fraction.) {16.54)
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