b) The MTA uses equipment (K), labor (L) and supplies (S) to produce public transportation services according to the production function Q =K®5L©25G@5_ b.1) What kind of returns to scale does this production function exhibit? b.2) What is the marginal product of labor? Does the production function exhibit diminishing marginal returns? b.3) What is the marginal rate of technical substitution of equipment for labor services? Does it depend on the MTA's usage of supplies? b.4) Assume that K = 16. In a diagram measuring labor along the horizontal axis and supplies along the vertical axis draw one of the MTA's isoquants.
b) The MTA uses equipment (K), labor (L) and supplies (S) to produce public transportation services according to the production function Q =K®5L©25G@5_ b.1) What kind of returns to scale does this production function exhibit? b.2) What is the marginal product of labor? Does the production function exhibit diminishing marginal returns? b.3) What is the marginal rate of technical substitution of equipment for labor services? Does it depend on the MTA's usage of supplies? b.4) Assume that K = 16. In a diagram measuring labor along the horizontal axis and supplies along the vertical axis draw one of the MTA's isoquants.
Microeconomics A Contemporary Intro
10th Edition
ISBN:9781285635101
Author:MCEACHERN
Publisher:MCEACHERN
Chapter7: Production And Cost In The Firm
Section7.A: Appendix: A Closer Look At Production And Cost
Problem 1AQ
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