The production function uses labor, capital, and TFP, and it has a Cobb-Douglas form.
economics
Description
INSTRUCTIONS.
follow the following instructions for the submission of your completed problem set.
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5. You should submit your completed problem set before Friday, February 5th, at 11:59pm.
6. Problem sets should be written individually
QUESTION 1. [60 points].
Consider an industry for an homogeneous product with the following characteristics.
- The production function uses labor, capital, and TFP, and it has a Cobb-Douglas form.
- All the Örms use the same amount of capital (the same Öxed equipment).
- Firms sell their output in the same product market at the same price.
- Firms are in di§erent geographic locations with di§erent labor markets.
- Firms are price takers in labor and product markets and maximize proÖts.
Instruction Files
eco310problemset0120211.pdf
76.7 KB
