Question
y=K^a L^(1-a) a. Use your answer for part a and the relationship between logs and growth rates to show that find the growth rate of
y=K^a L^(1-a)
a. Use your answer for part a and the relationship between logs and growth rates
to show that find the growth rate of Y if a = 0.3, K grows at 2%, and L grows at 1%
b. Find the marginal product of capital and labor by taking the derivative of with
respect to K and L
d. Check that Y=MPK*K + MPL=L This will be handy when we talk about
firm optimization behavior.
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Financial Algebra advanced algebra with financial applications
Authors: Robert K. Gerver
1st edition
978-1285444857, 128544485X, 978-0357229101, 035722910X, 978-0538449670
