Given a production function
,if
,
,
,and
,
(a)calculate the steady-state level of capital.
(b)does the above production function exhibit constant returns to scale? Or does it exhibit diminishing marginal returns? Explain,including defining the difference between these two concepts.

Question

Given a production function  
,if  
,  
,  
,and  
,
(a)calculate the steady-state level of capital.
(b)does the above production function exhibit constant returns to scale? Or does it exhibit diminishing marginal returns? Explain,including defining the difference between these two concepts.

Quizplus · Accepted Answer

The Answer of Given a production function  
,if  
,  
,  
,and  
,
(a)calculate the steady-state level of capital.
(b)does the above production function exhibit constant returns to scale? Or does it exhibit diminishing marginal returns? Explain,including defining the difference between these two concepts.

Given a Production Function