What are the features of a Cobb-Douglas production function?
What will be an ideal response?
A Cobb-Douglas production function is of the form: Y= A × Ka × Hb. Y denotes total output, A denotes the level of technology, K denotes the capital stock, and H denotes the number of efficiency units of production. The coefficients of K and H show the percentage of contribution of each factor of production to the gross domestic product. These coefficients always add up to 1. This ensures that the production function exhibits constant returns to scale.
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In the Primary Metals industry, it is estimated that the elasticity of output with respect to labor is 0.51 and the elasticity of output with respect to capital is 0.73
These two measures indicate that the primary metals industry is characterized by A) decreasing returns to scale. B) constant returns to scale. C) increasing returns to scale. D) no returns to scale.
The analytical framework in which two or more individuals, companies, or nations compete for certain payoffs that depend on the strategy that others employ is
A) game theory. B) opportunistic behavior. C) the dominant equilibrium. D) the tit-for-tat equilibrium.
Suppose you sold 20 futures contracts at a price of $5.00 per bushel and suppose the maintenance margin is $1300 per contract. At the end of the first trading day when the price fell from $5.00 to $4.80 per bushel, the amount of the margin call you had to make is
A. $0 B. $10,000 C. $20,000 D. $6,000.
Exports minus imports equals net exports.
a. true b. false