Consider the following production functions, to be used in this week’s assignment: (A) F(L, K) = 20L^2 + 20K^2 (B) F(L, K) = [L^1/2 + K^1/2]^2 For each of production functions (A) and (B) given above, do the following steps. (i) Calculate the marginal product of labor MPL(L, K) = ∂F(L, K) / ∂L. (ii) Calculate the marginal product of capital MPK(L, K) = ∂F(L, K) / ∂K. (iii) Calculate the absolute value of the technical rate of substitution as the ratio of marginal products and simplify as far as possible: |TRS(L, K)| = MPL(L, K) / MPK(L, K). PLEASE SHOW ALL WORK
Consider the following production functions, to be used in this week’s assignment: (A) F(L, K) = 20L^2 + 20K^2 (B) F(L, K) = [L^1/2 + K^1/2]^2 For each of production functions (A) and (B) given above, do the following steps. (i) Calculate the marginal product of labor MPL(L, K) = ∂F(L, K) / ∂L. (ii) Calculate the marginal product of capital MPK(L, K) = ∂F(L, K) / ∂K. (iii) Calculate the absolute value of the technical rate of substitution as the ratio of marginal products and simplify as far as possible: |TRS(L, K)| = MPL(L, K) / MPK(L, K). PLEASE SHOW ALL WORK
Managerial Economics: Applications, Strategies and Tactics (MindTap Course List)
14th Edition
ISBN:9781305506381
Author:James R. McGuigan, R. Charles Moyer, Frederick H.deB. Harris
Publisher:James R. McGuigan, R. Charles Moyer, Frederick H.deB. Harris
Chapter7: Production Economics
Section: Chapter Questions
Problem 5E
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Consider the following production functions, to be used in this week’s assignment:
(A) F(L, K) = 20L^2 + 20K^2
(B) F(L, K) = [L^1/2 + K^1/2]^2
For each of production functions (A) and (B) given above, do the following steps.
(i) Calculate the marginal product of labor MPL(L, K) = ∂F(L, K) / ∂L.
(ii) Calculate the marginal product of capital MPK(L, K) = ∂F(L, K) / ∂K.
(iii) Calculate the absolute value of the technical rate of substitution as the ratio of marginal products and
simplify as far as possible: |TRS(L, K)| = MPL(L, K) / MPK(L, K).
PLEASE SHOW ALL WORK
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