Suppose the production function is Cobb-Douglas and f(x1,x2)) = x11/2x3/22 1. Write an expression for the marginal product of x1. 2. Does marginal product of x1 increase for small increases in x1, holding x2 fixed? Explain 3. Does an increase in the amount of x2 lead to decrease the marginal product of x1? Explain
Suppose the production function is Cobb-Douglas and f(x1,x2)) = x11/2x3/22 1. Write an expression for the marginal product of x1. 2. Does marginal product of x1 increase for small increases in x1, holding x2 fixed? Explain 3. Does an increase in the amount of x2 lead to decrease the marginal product of x1? Explain
Managerial Economics: Applications, Strategies and Tactics (MindTap Course List)
14th Edition
ISBN:9781305506381
Author:James R. McGuigan, R. Charles Moyer, Frederick H.deB. Harris
Publisher:James R. McGuigan, R. Charles Moyer, Frederick H.deB. Harris
Chapter7: Production Economics
Section: Chapter Questions
Problem 7E
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Suppose the production function is Cobb-Douglas and f(x1,x2)) = x11/2x3/22
1. Write an expression for the marginal product of x1.
2. Does marginal product of x1 increase for small increases in x1, holding x2 fixed? Explain
3. Does an increase in the amount of x2 lead to decrease the marginal product of x1? Explain
4. What is the the technical rate of substitution between x2 and x1?
5. What is the type of returns to scale of this production function? (Increasing, decreasing,
constant)
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