Estimate the cobb Douglas production function Q = ΑL^B1K^Β2, where Q= out put, L labour input K= capital input and A,B1,B2 are parameters to be estimated.
test whether the coeficient of capital and labour are statistically significant.
Determine the percentage of the variation in output that is explained by the regression equation
Determine the labour and capital esitmated parameters and give an economic interpretation of each value. economical interpretation.
Determine whether this production funtion exhibits increasing, decresing, or constant returns to scale. Ignore the issue of statistical significant.
Cobb Douglas Production is estimated.