Consider a Production Function of the Form $Q = K ^ { 2 } L ^ { 2 }$

question 20

Multiple Choice

Consider a production function of the form $Q = K ^ { 2 } L ^ { 2 }$ with marginal products MP_K = 2KL² and MP_L = 2K²L. What is the marginal rate of technical substitution of labor for capital at the point where K = 5 and L = 5?

• A) 5
• B) 25
• C) 50
• D) 1

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Definitions:

Current Year

The ongoing calendar year during which an event or measurement is taking place.

Laspeyres Price Index

An index that measures the change in the price of a basket of goods and services based on the quantities purchased in a base period.

Base Year

A specific year against which economic or financial data is compared to assess changes or growth over time.

Current Year

The ongoing or present calendar year.