Suppose that the following Cobb - Douglas production function represents the economy of Malaysia: Y F K, L AK 0.3L0.7. Assuming output, capital and labour to be RM10 trillion, RM8 trillion and 20 million workers respectively, (a ) Calculate the marginal product of labour (b) Calculate the marginal product of capital (c) Does the above-mentioned production function exhibit constant returns to scale? Please provide reasoning to support your answer.
Suppose that the following Cobb - Douglas production function represents the economy of Malaysia: Y F K, L AK 0.3L0.7. Assuming output, capital and labour to be RM10 trillion, RM8 trillion and 20 million workers respectively, (a ) Calculate the marginal product of labour (b) Calculate the marginal product of capital (c) Does the above-mentioned production function exhibit constant returns to scale? Please provide reasoning to support your answer.
Chapter9: Production Functions
Section: Chapter Questions
Problem 9.2P
Related questions
Question
![Suppose that the following Cobb - Douglas production function represents the economy of Malaysia: Y F K, L
AK 0.3L0.7. Assuming output, capital and labour to be RM10 trillion, RM8 trillion and 20 million workers respectively, (a
) Calculate the marginal product of labour (b) Calculate the marginal product of capital
(c) Does the
above-mentioned production function exhibit constant returns to scale? Please provide reasoning to support your
answer.](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F06626787-9cb4-4222-bb27-39dcf42cb6cc%2F2eb0f942-db8f-41f1-807e-f534ff3ce48f%2F1uy4p5_processed.jpeg&w=3840&q=75)
Transcribed Image Text:Suppose that the following Cobb - Douglas production function represents the economy of Malaysia: Y F K, L
AK 0.3L0.7. Assuming output, capital and labour to be RM10 trillion, RM8 trillion and 20 million workers respectively, (a
) Calculate the marginal product of labour (b) Calculate the marginal product of capital
(c) Does the
above-mentioned production function exhibit constant returns to scale? Please provide reasoning to support your
answer.
Expert Solution
![](/static/compass_v2/shared-icons/check-mark.png)
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
Step by step
Solved in 2 steps
![Blurred answer](/static/compass_v2/solution-images/blurred-answer.jpg)
Recommended textbooks for you
![Managerial Economics: Applications, Strategies an…](https://www.bartleby.com/isbn_cover_images/9781305506381/9781305506381_smallCoverImage.gif)
Managerial Economics: Applications, Strategies an…
Economics
ISBN:
9781305506381
Author:
James R. McGuigan, R. Charles Moyer, Frederick H.deB. Harris
Publisher:
Cengage Learning
![Managerial Economics: Applications, Strategies an…](https://www.bartleby.com/isbn_cover_images/9781305506381/9781305506381_smallCoverImage.gif)
Managerial Economics: Applications, Strategies an…
Economics
ISBN:
9781305506381
Author:
James R. McGuigan, R. Charles Moyer, Frederick H.deB. Harris
Publisher:
Cengage Learning
![Economics (MindTap Course List)](https://www.bartleby.com/isbn_cover_images/9781337617383/9781337617383_smallCoverImage.gif)
Economics (MindTap Course List)
Economics
ISBN:
9781337617383
Author:
Roger A. Arnold
Publisher:
Cengage Learning
![Macroeconomics](https://www.bartleby.com/isbn_cover_images/9781337617390/9781337617390_smallCoverImage.gif)
![Micro Economics For Today](https://www.bartleby.com/isbn_cover_images/9781337613064/9781337613064_smallCoverImage.gif)