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For the production function q = f(K, L) the ratio of the percentage change on with PK is called elasticity of substitution. Write down a constant returns to scale PL percentage change on Cobb-Douglas production function and find its elasticity of substitution for the K = 10, L = 7, PK = 4 and PL = 3 levels.

For the production function q = f(K, L) the ratio of the percentage change on with PK is called elasticity of substitution. Write down a constant returns to scale PL percentage change on Cobb-Douglas production function and find its elasticity of substitution for the K = 10, L = 7, PK = 4 and PL = 3 levels.

Economics (MindTap Course List)
Economics (MindTap Course List)
13th Edition
ISBN:9781337617383
Author:Roger A. Arnold
Publisher:Roger A. Arnold
Chapter17: Economic Growth: Resources, Technology, Ideas And Institutions
Section17.2: A Production Function And Economic Growth
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K For the production function q = f(K, L) the ratio of the percentage change on with PK percentage change on is called elasticity of substitution. Write down a constant returns to scale PL Cobb-Douglas production function and find its elasticity of substitution for the K = 10, L = 7, PK = 4 and Pt 3 levels.
Transcribed Image Text:K For the production function q = f(K, L) the ratio of the percentage change on with PK percentage change on is called elasticity of substitution. Write down a constant returns to scale PL Cobb-Douglas production function and find its elasticity of substitution for the K = 10, L = 7, PK = 4 and Pt 3 levels.
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