Question: Verify for the Cobb-Douglas production function P(L, K) = 1.01L 0.75 K 0.25 discussed in Example 3 that the production will be doubled if both

Verify for the Cobb-Douglas production function

P(L, K) = 1.01L^0.75K^0.25

discussed in Example 3 that the production will be doubled if both the amount of labor and the amount of capital are doubled. Determine whether this is also true for the general
production function

P(L, K) = bL^aK^1-a

Step by Step Solution

★★★★★

3.30 Rating (159 Votes )

There are 3 Steps involved in it

1 Expert Approved Answer

Step: 1 Unlock

If the amounts of labor and capital are both doubled we r... View full answer

Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock

Step: 3 Unlock

Students Have Also Explored These Related Precalculus Questions!

The Cobb-Douglas production function is a classic model from economics used to model output as a function of capital and labor. It has the form a. In this example, assume c0 = 5, c1 = 0.25, and c2 =...

Suppose that a company's production for Q units of its product is given by the Cobb-Douglas production function Q = 70K2/3L1/3 where K is dollars of capital investment and L is labor hours. (a) Find...

Show that the Cobb-Douglas production function satisfies P(L, K 0 ) = C 1 (K 0 )Lby solving the differential equation dP/dL = a P/L

Q2 Read the Jupiter Electronics case study in Chapter 19 and provide responses to the following questions: There are three basic features that should be incorporated into a theoretical framework: a....

10. Jake and Paul run a paper company. Each week they need to produce 1,000 reams of paper to ship to their customers. The paper plants longrun production function is Q = 4 K 0.75 L 0.25 , where Q is...

Hello Please assist with the following set of questions, please provide easy to read solutions [7.5] 1. [-/1 Points] DETAILS BERRAPCALC7 7.5.001.MI. MY NOTES PRACTICE ANOTHER Use Lagrange multipliers...

. Provide solutions to the following economic questions. Chapter 8 Pricing strategies This chapter teaches of different pricing strategies for your products or services and shows how these can...

this question please! For the Cobb-Douglas production function P and isocost line (budget constraint, in dollars), nd the amounls of labor L and capital K that maximize production, and also nd the...

For the Cobb - Douglas production function P and isocost line ( budget constraint, in dollars ) , find the amounts of labor L and capital K that maximize production, and also find the maximum...

please explain as well please explian as well please explian as well 2. CASE STUDY (This case study is adapted from one written by Mike Price. We will contime it in the Week 5 written homework.) The...

Which of the following would not be an example of a fixed cost? a. insurance on factory building b. property taxes c. glue used to put together tables d. depreciation on factory building

A one-sided confidence interval can be found for a mean by using Where t a is the value found under the row labeled One tail. Find two one-sided 95% confidence intervals of the population mean for...

Financing activities have no impact on the income statement, but rather are reflected in changes in long - term debt and short - term debt on the balance sheet. Group of answer choices True False

What are the significant similarities and differences between speed and velocity?

Suppose h is a function such that h(1) = 2, h'(1) = 2, h"(1) = 3, h(2) = 6, h'(2) = 5, h"(2) = 13, and h" is continuous everywhere. Evaluate 2 1 h"(u) du.

Evaluate the definite integral. xa-x dx

Two similar-looking series are given. Test each one for convergence or divergence. a. b. n-1 (-1)" 73/12

MATHS EXPERTS During the past two decades, redefinition of many of the beliefs and assumptions which underly nursing appears to have contributed to an increasing divergence between nursing theory and...

2-326 Nimitz Rental Company provided the following information to its auditors. For the year ended March 31, 2014, the company had revenues of $876,579, general and administrative expenses of...

Question 16 {Mandatory} [1 point] A bin contains 8 apples and 12 pears. Five pieces of fruit are randomly chosen from the bin. a} What is the probability that two are apples? b} What is the expected...