If the production function for GDP is Cobb-Douglas in labour and capital, with the exponent on capital is a space equals space 1 third, and assuming constant returns to scale, and a perfectly competitive goods market a. The marginal product of labour (vertical axis) will have a positive, concave slope when plotted against labour (horizontal axis) b. In equlibrium, wage will equal 2 over 3 y, where y is output per worker c. Labour and capital are complements so the derivative fraction numerator d squared Y over denominator d L d K end fraction less than 0 d. None of the answers is correct e. The marginal product of labour is: left parenthesis 1 minus a right parenthesis A open parentheses Lover K close parentheses to the power of a
If the production function for GDP is Cobb-Douglas in labour and capital, with the exponent on capital is a space equals space 1 third, and assuming constant returns to scale, and a perfectly competitive goods market a. The marginal product of labour (vertical axis) will have a positive, concave slope when plotted against labour (horizontal axis) b. In equlibrium, wage will equal 2 over 3 y, where y is output per worker c. Labour and capital are complements so the derivative fraction numerator d squared Y over denominator d L d K end fraction less than 0 d. None of the answers is correct e. The marginal product of labour is: left parenthesis 1 minus a right parenthesis A open parentheses Lover K close parentheses to the power of a
Chapter1: Making Economics Decisions
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Problem 1QTC
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Transcribed Image Text:If the production function for GDP is Cobb-Douglas in labour and capital, with the exponent on capital is
a space equals space 1 third, and assuming constant returns to scale, and a perfectly competitive goods
market a. The marginal product of labour (vertical axis) will have a positive, concave slope when plotted
against labour (horizontal axis) b. In equlibrium, wage will equal 2 over 3 y, where y is output per worker
c. Labour and capital are complements so the derivative fraction numerator d squared Y over
denominator d L d K end fraction less than 0 d. None of the answers is correct e. The marginal product
of labour is: left parenthesis 1 minus a right parenthesis A open parentheses Lover K close parentheses
to the power of a
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