Question from Past Microeconomics Qualifying ExamEdit
Spring 2001 - Section II, Question two, George Mason University Give complete answers to three of the following four questions (about 25percent each) Write clear concise and legible answers.:
The following question is in three parts:
- a. "The marginal productivity basis of the demand for labor is inapplicable to cases where the labor is doing research, teaching or performing some other task where the product is not sold on the market. The reason is that there is no identifiable, measurable marginal product." Evaluate.
- b. A theorem commonly used in economics is that if the production function is homogeneous of the first degree the marginal product itmes the quantity of the input will, when summed over all inputs, exhaust the total product. If the production function is not homogeneous fo the first degree, what can be said about the distribution of the product?
- c. If there is joint production, it is impossible to tell what input produced how much. What then is the meaning of the statement that each input gets what it produces?