Question
You are given the production function: Q (K,L) = 4K 0.6 L 0.4 a)What is the average product of labour, holding capital fixed at K?
You are given the production function: Q (K,L) = 4K0.6L0.4
a)What is the average product of labour, holding capital fixed at K? Simplify fully [6 marks]
b)What is the marginal rate of technical substitution (MRTS)? Simplify fully [13 marks]
c)Does the above function exhibit increasing, decreasing or constant returns to scale? Illustrate why and explain what this means [6 marks]
Step by Step Solution
There are 3 Steps involved in it
Step: 1
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
Business Law
Authors: Henry Cheeseman
8th Edition
0133130649, 9780133130645
