An industry can be characterized by the following production function:
Q = 2.5L.60 C.40
(a) What is the algebraic expression for the marginal productivity of labor?
(b) What is the algebraic expression for the average productivity of labor?
(c) How would you characterize the returns-to-scale in the industry?
Correct Answer:
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b)
(c) This production function is of...
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