With a Cobb-Douglas production function, the share of output going to labor:
A) decreases as the amount of labor increases.
B) increases as the amount of labor increases.
C) increases as the amount of capital increases.
D) is independent of the amount of labor.

Question

Quizplus · Accepted Answer

The share of output going to labor in a Cobb-Douglas production function is determined by the labor exponent in the function, which remains constant regardless of the amount of labor used.

With a Cobb-Douglas Production Function, the Share of Output Going