Consider the Production Function: Y = 1.5 K L¹, where a = 0.7. K is capital, and Lis labor a) Using the gradient, find the marginal product of capital and the marginal product of labor. : b) Let's explore the marginal products further. b.1) What happens to the marginal productivity of capital when labor increases?" b.2) What happens to the marginal productivity of labor when capital increases? ^ c) Assume that alpha is not a constant. 0 < a < 1, and is considered as another variable in the above production function, find the total differential of Y.

Consider the Production Function: Y = 1.5 K L¹, where a = 0.7. K is capital, and Lis labor a) Using the gradient, find the marginal product of capital and the marginal product of labor. : b) Let's explore the marginal products further. b.1) What happens to the marginal productivity of capital when labor increases?" b.2) What happens to the marginal productivity of labor when capital increases? ^ c) Assume that alpha is not a constant. 0 < a < 1, and is considered as another variable in the above production function, find the total differential of Y.

Microeconomic Theory

12th Edition

ISBN:9781337517942

Author:NICHOLSON

Publisher:NICHOLSON

Chapter9: Production Functions

Section: Chapter Questions

Problem 9.2P

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