Assume an aggregate production function where Y=(L^0.6)*(K^0.4). Then it must be true that. O a. the share of capital income in total income is 40%. O b. increasing the ratio of capital to labor will reduce the marginal productivity of labor. O C. the production function exhibits increasing returns to scale.
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- Output per worker ($ thousands) 0 Select one or more: 0 Capital equipment per worker ($ thousands) Which TWO of the following statements are correct? O a. The slope of the function is the marginal product of capital. b. The figure shows that each extra $ of capital per worker raises output per worker by an equal amount. ✔ C. The function is "convex" (L.e. it has a slope which increases as capital per worker rises). Od. The figure shows that higher capital per worker increases output per worker. Production functionConsider the augmented production function Y equals A K to the power of 1 divided by 3 end exponent open parentheses H N close parentheses to the power of 2 divided by 3 end exponent, where Y is output, A is total factor productivity, K is capital, N is the number of workers, and H is average years of education. Suppose that A=2, K=8, and N=1000. What is the average product of labor (or output per worker) if H is 15.7?Assume that we have a Cobb-Douglas type aggregate production function in the form: Y=W.Kr.L1-r where : W=technology and r is standard share parameter of Cobb-Douglas production function. b. Why does (or does not) technology affects MRTS? Explain. c. Find output per effective labor; capital per effective labor (y=Y/WL and k= K/WL ). d. Find elasticity of substitution between K and L. Why does (or does not) the result different from previous question (Question-1) (Y=Ka.Lb) ? (Question 1: Assume that we have a Cobb-Douglas type aggregate production function in the form: Y=Ka.Lb )
- Consider the production function Y=K1/2 N1/2 a. Compute output when K=37 and N=80 b. If both capital and labour double, what happens to output? c. Is this production function characterized by constant returns to scale? Explain. d. Are there decreasing returns to capital? Explain. e. Are there decreasing returns to labour? Explain. f. Write this production function as a relationship between output per worker and capital per worker. Show all your work. g. Let capital per worker be 6. What is output per worker? Now, double capital per worker to 12. Does output per worker more or less than double? h. Does the relation between output per worker and capital per worker exhibit constant returns to scale? Explain/show your workHow does the slope of the production function illustrate diminishing returns? The slope of the production function becomes steep as the quantity of increases because of diminishing returns. A. more; capital B. more; labor O C. less; labor D. less; capital Click to select your answer. MacBook Air 吕0 000 000 FS F4 F3 esc F2 F1 % #Consider the following constant returns to scale production function Y=f(K,AN). Doubling output is possible if one: a. None of the above. O b. Doubles simultaneously K, A and N. O C. Doubles simultaneously K and A. d. Doubles simultaneously A and N.
- What is the effect of diminishing returns to labor on the slope of the aggregate production function (where output is measured on the vertical axis and employment is measured on the horizontal axis)? a. It implies that the slope of the curve decreases as the number of workers employed increases. b. It keeps the slope the same throughout. c. It implies that the slope of the curve becomes negative as the number of workers employed increases. d. It has nothing to do with the slope of the aggregate production function. e. It implies that the slope of the curve increases as the number of workers employed increases.The figure shows the total product curve for different levels of a variable input, labor. Output Total Product curve АВ с D E Quantity of Labor In the figure, at point C O average product equals marginal product O marginal product is at a maximum total product is increasing at an increasing rate average product is declining but positiveSuppose that a firm's production function is given by the following relationship: Q = 2.5√/LK (i.e., Q = 2.5L0.5 K0.5) where is output, L is labor input, and K is capital input. What is the percentage increase in output if labor input is increased by 10%? (Assume that capital input is held constant.) What is the percentage increase in output if capital input is increased by 25%? (Assume that labor input is held constant.) What is the the percentage increase in output if both labor and capital are increased by 10%? 11
- If a firm has a production function of the form: Q = LK1/2, what can we conclude? The firm has constant marginal returns to labour and increasing marginal returns to capital. O The firm has decreasing marginal returns to labour and increasing marginal returns to capital. The firm has constant marginal returns to labour and constant marginal returns to capital. The firm has constant marginal returns to labour and decreasing marginal returns to capital. O The firm has increasing marginal returns to labour and increasing marginal returns to capital.2. Consider a Cobb-Douglas production function with three inputs. K is capital (the number of machines), L is labor (the number of workers), and H is human capital (the number of college degrees among the workers). The production function Y = K2/6 L3/6 H1/6 a) Derive an expression for the marginal product of labor. How does an increase in the amount of human capital affect the marginal product of labor? (Hint: The marginal product of labor MPL is found by differentiating the production function (Y) with respect to labor (L)) b) Derive an expression for the marginal product of capital. How does an increase in the amount of human capital affect the marginal product of capital? (Hint: The marginal product of capital MPK is found by differentiating the production function (Y) with respect to capital (K)).1. Suppose the production function is Q = 8L + 15K where Q is the quantity of output, L is the quantity of labor used in production, and K is the quantity of capital used in production. What can be said about this production function? It has Decreasing Returns to Scale It has Constant Returns to Scale It has Increasing Returns to Scale There isn’t enough information to determine the Returns to Scale for this production function 2. You’re dreaming of what to do during a nice summer day. You could mow the lawn which you would pay someone $15 to do for you. You could go for a walk which you value at $11. You could also take a nap and ignore everyone and everything else which you would pay $29 to do. If you to take a nap, what is your opportunity cost? Group of answer choices $29 $26 $15 $11