Question: 1.Consider the following aggregate production function: , where A is the total factor productivity, K is the amount of capital in the economy, L is

1.Consider the following aggregate production function: , where A is the total factor productivity, K is the amount of capital in the economy, L is the labour force, and Y is the GDP.

a.Is this aggregate production function exhibiting the constant returns to scale? Explain how you know. (2)

b.Is this aggregate production function exhibiting the diminishing marginal product of capital? Explain how you know. (2)

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