Calculating Marginal Productivity of Capital and Labor

The production function for the personal computers of DISK Inc. is given by Q= 10 (K *L)^0.5. DISK's competitor FLOPPY Inc's production function is Q = 10K^0.6 L^0.4.
(a) If K is limited to 9 units, in which company MP of labor greater?
(b) What can you say about the MP of labor for a given K?

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The production function for the personal computers of DISK Inc. is given by Q= 10 (K *L)^0.5. DISK's competitor FLOPPY Inc's production function is Q = 10K^0.6 L^0.4.
(a) If K is limited to 9 units, in which company MP of labor greater?
(b) What can you say about ...

Solution Summary

The solution provides detailed explanation of how to compute marginal productivity of labor and capital using specific production functions given in the problem.

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c. is greater than the average product of labor when the average product of labor is decreasing
d. can be negative
e. a and b

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3 8 18 25 30 34

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