Question: Consider the Cobb-Douglas production function with parameter a=1/3 What fraction of income do capital and labor receive? Suppose that the immigration increase labor force by

Consider the Cobb-Douglas production function with parameter a=1/3

  1. What fraction of income do capital and labor receive?
  2. Suppose that the immigration increase labor force by 15%. What happen to total output ( in percent)? The rental price of capital? The real wage?
  3. Suppose technology parameter A increase by 5%. What happen to total output ( in percent)? The rental price of capital? The real wage?

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