Provide a Graph and an Explanation to Show That the Production

question 34

Essay

Provide a graph and an explanation to show that the production function Q = L^0.5K^0.5 has diminishing marginal product of labor but has constant returns to scale.

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Definitions:

Inflation Rate

A rate, described in percentages, indicating how prices for various goods and services are climbing, which in turn decreases the value of money.

GDP Deflator

A measure of the level of prices of all new, domestically produced, final goods and services in an economy, used to deflate or adjust the nominal GDP to real GDP.

Intermediate Good

A product used as an input in the production of a final good or service.

GDP

Gross Domestic Product, the total value of all goods and services produced within a country's borders in a specific time period.