The productivity of a certain country with the utilization of x units of labor and y units of capital is given approximately by the function f(x,y)=100x0.65y0.35. (A) Find fx(x,y) and fy(x,y). (B) If the country is now using 300 units of labor and 200 units of capital, find the marginal productivity of labor and the marginal productivity of capital. (C) For the greatest increase in the country's productivity, should the government encourage increased use of labor or increased use of capital?

The productivity of a certain country with the utilization of x units of labor and y units of capital is given approximately by the function f(x,y)=100x0.65y0.35. (A) Find fx(x,y) and fy(x,y). (B) If the country is now using 300 units of labor and 200 units of capital, find the marginal productivity of labor and the marginal productivity of capital. (C) For the greatest increase in the country's productivity, should the government encourage increased use of labor or increased use of capital?

Microeconomic Theory

12th Edition

ISBN:9781337517942

Author:NICHOLSON

Publisher:NICHOLSON

Chapter9: Production Functions

Section: Chapter Questions

Problem 9.1P

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(A)	Find fx(x,y) and fy(x,y).
(B)	If the country is now using 300 units of labor and 200 units of capital, find the marginal productivity of labor and the marginal productivity of capital.
(C)	For the greatest increase in the country's productivity, should the government encourage increased use of labor or increased use of capital?