Statistics Solutions

(All Steps) Let a firm’s production function be given by q=K^0.3L^0.7 . (i) Sketch the shape of the long run average and long-run marginal cost curves; (ii)

Question: Let a firm’s production function be given by \(q={{K}^{0.3}}{{L}^{0.7}}\) . (i) Sketch the shape of the long run average and long-run marginal cost curves; (ii) In the same graph, also sketch the firm’s short-run average and marginal cost curves (when the amount of capital is fixed). Comment on the relationship between the long-run and short-run curves.

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Solution: The downloadable solution consists of 3 pages
Deliverable: Word Document


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