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Determine the marginal product of inputs

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The production function for the automotive and parts industry is q=L^0.27K^0.16M^0.61, where M is the energy and materials. What kind of returns to scale does this production function exhibit? What is the marginal product of Labor, capital and Materials?

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Solution Summary

Solution depicts the steps to determine the returns to scale. It also estimates the marginal product of input factors.

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Please refer attached file for the equations and solution.

In this case, production function is represented by a Cogg Douglas function.

Where each exponent is respective elasticity of ...

Solution provided by:
Lokesh Jain, MSc
Education
  • BEng (Hons) , Birla Institute of Technology and Science, India
  • MSc (Hons) , Birla Institute of Technology and Science, India
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