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Q = ln L + ln K In microeconomic theory, the Marginal Rate of Technical Substitution (MRTS) is the amount by which the quantity of one input has to be reduced when one extra unit of another input is used, so that output remains constant. MRTS = MPL/MPK = Q(L)'/Q(K)' = (1/L)/(1/K) = K/L
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explain the concept of marginal rate of substitution and marginal rate of transformation. and show these concept graphically?
Marginal rate of substitution is the slope of the indifference curve. It is the rate at which the consumer is willing to give up certain units of a good in...
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At L=4, K=4, the marginal product of labour is 2 and the marginal product of capital is 3. What is the marginal rate f technical substitution?
At L=4, K=4 MPl = 2, MPk = 3. Marginal Rate of Technical Substitution (MRTS) is the amount by which the quantity of one input has to be reduced when...
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Compare and contrast marginal rate of substitution and marginal rate technical substitution.
Marginal rate of substitution1.MRS is the rate at which a consumer is willing to trade one good for another to maintain a constant level of utility.2.MRS is the slope of...
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At L=4, k=4, the marginal product of labor is 2 and the marginal product of capital is 3. what is the marginal rate of substitution?
At L=4, K=4 MPl = 2, MPk = 3. Marginal Rate of Technical Substitution (MRTS) is the amount by which the quantity of one input has to be reduced when...
1 Answers 1 views
q=100+p-0.01p2+2n-0.03n2
determine the marginal rate of technical substitution.
Marginal Rate of Technical Substitution (or Technical Rate of Substitution) is the amount by which the quantity of one input (n) has to be reduced when one extra unit of...
1 Answers 1 views
Given the production function:
Q = 100 + P – 0.01P2 + 2N – 0.03N2
Determine the marginal rate of technical substitution
Marginal Rate of Technical Substitution (or Technical Rate of Substitution) is the amount by which the quantity of one input (n) has to be reduced when one extra unit of...
1 Answers 1 views
Given the production function:
Q = 100 + P – 0.01P2 + 2N – 0.03N2
Determine the marginal rate of technical substitution
Marginal Rate of Technical Substitution (or Technical Rate of Substitution) is the amount by which the quantity of one input (N) has to be reduced when one extra unit of...
1 Answers 1 views
Given the Production function:
Q=100+P-0.01P2+2N-0.03N2
Determine the marginal rate of technical substitution.
Marginal Rate of Technical Substitution is the amount by which the quantity of one input (n) has to be reduced when one extra unit of another input (n2) is used,...
1 Answers 1 views
Explain the concept of marginal rate of substitution and marginal rate of transformation. And show these concepts graphically?
Marginal rate of substitution is the slope of the indifference curve. It is the rate at which the consumer is willing to give up certain units of a good in...
1 Answers 1 views
Consider a production function given as Q(X_(1 ,) X_2)=x_1^0.4 x_2^0.6
Calculate the marginal rate of technical substitution of x_(1 )for x_2
Q(X1, X2) = x1^0.4*x2^0.6, MP1 = Q'(x1) = 0.4x2^0.6/x1^0.6, MP2 = Q'(x2) = 0.6x1^0.4/x2^0.4, The marginal rate of technical substitution of x1 for x2 is: MRTS (x1, x2) = MP1/MP2...
1 Answers 1 views