How much food does the economy produce

Reference no: EM133269727

Assignment:

Question:

The production function with only land and workers. Suppose the production function in medieval Europe is ??=????.??????.??, where Y is the amount of food produced, ?? is the amount of land and ?? is the number of workers. The economy begins with 32 units of land and 32 workers. Assume a neoclassical competitive economy where there is no mark-up, no unemployment, and where landlords and workers are paid their marginal products. Find a numerical answer to each of the following.

(a) How much food does the economy produce?

(b) What are the wage and the rental price of land?

(d) If a plague kills half the population, what is the new output level?

(e) What is the new wage and what is the new rental price of land?

(f) What share of output does labour receive now?

Reference no: EM133269727

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