Intermediate Economic Principles - Exam 2 Answers | AAEC 3580, Exams of Agricultural engineering

Download Intermediate Economic Principles - Exam 2 Answers | AAEC 3580 and more Exams Agricultural engineering in PDF only on Docsity! M. Wetzstein AAEC 3580 Possible 4 1 2. University of Georgia Department of Agricultural Applied Economics Examination #2 Answers Your name or SS# is Consider the following production function q= VlnK + VinL a. What are the output elasticities for the two inputs? x = aV/EK(K/q) = 1/Bq) , = ALL) = 14g) b. What stage of production does the production function represent for K? For 0< q < % Stage I For q > %, Stage IT c What is the elasticity of substitution for K and L? MRTS(K for L) = 44(K/L) K/L = (43)MRTS g=1 d. What is the returns to seale for this production function? q(tK, tL) = YaintK + intl = (7/12jInt + g AUK, tLy/a = 7/129 > 0 Og(tK, tL = -7120) < 0: max ~ ding returns to scale 16 3. Graph the SATC, SAVC, TFC, SMC, LAC and LMC for the associated cost curves. Cost S| Cost per-unit Output STC(K?) STC(K*) | SMC(K?} t I | | | | 2g sMc(K'y | Economies of scale _ | Diseconomies of scal@