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

question 48

Multiple Choice

Assume that the production function is Cobb-Douglas with parameter α = 0.3. If factors are paid their marginal products, capital and labor, respectively, 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.

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