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Given a Cobb-Douglas production function, we can find the marginal product of capital and labor by taking partial derivatives.

Economics

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Answer

MPK

αAKα−1Lβ\alpha A K^{\alpha-1} L^\beta

MPL

βAKαLβ−1\beta A K^\alpha L^{\beta-1}

Step-by-step solution

2 steps

Given a Cobb-Douglas production function, we can find the marginal product of capital and labor by taking partial derivatives.

A general Cobb-Douglas production function is typically represented as:

Q=AKαLβQ = A K^\alpha L^\beta

where:

  • QQ is the total output
  • AA is the total factor productivity
  • KK is the capital input
  • LL is the labor input
  • α\alpha is the output elasticity of capital
  • β\beta is the output elasticity of labor
  1. Marginal Product of Capital (MPK)

    The marginal product of capital is the additional output produced by employing one more unit of capital, holding labor constant. It is found by taking the partial derivative of the production function with respect to capital (KK).

    MPK=∂Q∂KMPK = \frac{\partial Q}{\partial K} MPK=∂∂K(AKαLβ)MPK = \frac{\partial}{\partial K} (A K^\alpha L^\beta)

    Treating AA and LβL^\beta as constants:

    MPK=ALβ∂∂K(Kα)MPK = A L^\beta \frac{\partial}{\partial K} (K^\alpha) MPK=ALβ(αKα−1)MPK = A L^\beta (\alpha K^{\alpha-1}) MPK=αAKα−1LβMPK = \boxed{\alpha A K^{\alpha-1} L^\beta}
  2. Marginal Product of Labor (MPL)

    The marginal product of labor is the additional output produced by employing one more unit of labor, holding capital constant. It is found by taking the partial derivative of the production function with respect to labor (LL).

    MPL=∂Q∂LMPL = \frac{\partial Q}{\partial L} MPL=∂∂L(AKαLβ)MPL = \frac{\partial}{\partial L} (A K^\alpha L^\beta)

    Treating AA and KαK^\alpha as constants:

    MPL=AKα∂∂L(Lβ)MPL = A K^\alpha \frac{\partial}{\partial L} (L^\beta) MPL=AKα(βLβ−1)MPL = A K^\alpha (\beta L^{\beta-1}) MPL=βAKαLβ−1MPL = \boxed{\beta A K^\alpha L^{\beta-1}}
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