Question2 Imagine you work for a firm that only utilizes labor and capital as inputs and ha CES production function: q = f(L, K) = [aLº + BK²] Where a = B=0.5.y = 1.p = 2. a. What is the MPL ? What does this mean economically? b. What is the MPK? What does this mean economically?

Question2 Imagine you work for a firm that only utilizes labor and capital as inputs and ha CES production function: q = f(L, K) = [aLº + BK²] Where a = B=0.5.y = 1.p = 2. a. What is the MPL ? What does this mean economically? b. What is the MPK? What does this mean economically?

Principles of Economics (MindTap Course List)

8th Edition

ISBN:9781305585126

Author:N. Gregory Mankiw

Publisher:N. Gregory Mankiw

Chapter18: The Markets For The Factor Of Production

Section: Chapter Questions

Problem 9PA

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For QUESTION D only PLEASE!

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Question2 Imagine you work for a firm that only utilizes labor and capital as inputs and has a
CES production function:
q = f(L, K) = [aLº + BK²] 2/2
Where a = B=0.5.y = 1.p = 2.
a. What is the MPL ? What does this mean economically?
b. What is the MPK? What does this mean economically?
c. What is the MRTS? What does this mean economically?
d. Does this CES function have constant, increasing, or decreasing returns to scale?

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