Question

Sheet1 The Cobb-Douglas production function for a product is NIX.Y) - 10(x*O.B)(y^0.2) where is the number of units of labor and is the number of units of capital required to produce units of the product. What is the marginal productivity of labor and the marginal productivity of capital? What are they when there are 40 units of labor and 50 units of capital? NxIx.) Nx (40, 50) = Nyix,y) Ny 40, 50) If each unit of labor costs $100, each unit of capital costs $50, and $10,000 is budgeted for production of this product, what is the constraint equation? What is ? Use instead of What are and ? RIX.V) = Fix.y.h) Fxx.xh) = Fvix.x.h) = Fhix.v,h) = What are the units of labor and the units of capital that will maximize production? What is the maximum production? What is the marginal productivity of money? What is the approximate increase in production that would result from an increase of $2,000 in the amount budgeted for production? Use exact formulas, do not round. V h. N Approximate increase!

Answer 1