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Microeconomics 2nd Edition by Douglas Bernheim
Edition 2ISBN: 978-0071287616Microeconomics 2nd Edition by Douglas Bernheim
Edition 2ISBN: 978-0071287616 Exercise 2
There are two production plants for producing widgets out of labor and capital. Plant l's weekly production function is F 1 ( L , K ) = 12 (LK ) 1/4 and plant 2's weekly production function is F 2 ( L , K ) = (LK ) 1/2.
a. Do these technologies satisfy the Productive Inputs Principle
b. Derive the MRTS LK for each of the plants at input combination ( L , K ). Do the plants have declining MRTSs
c. Do the plants have increasing, decreasing, or constant returns to scale
a. Do these technologies satisfy the Productive Inputs Principle
b. Derive the MRTS LK for each of the plants at input combination ( L , K ). Do the plants have declining MRTSs
c. Do the plants have increasing, decreasing, or constant returns to scale
Explanation
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Microeconomics 2nd Edition by Douglas Bernheim
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