Assume That the Production Function Is Cobb-Douglas with Parameter α

question 33

Multiple Choice

Assume that the production function is Cobb-Douglas with parameter α = 0.3. If capital and labour are paid their marginal products, they receive the shares of income:

• A)0.3 and 0.3.
• B)0.7 and 0.7.
• C)0.3 and 0.7.
• D)0.7 and 0.3.