Technology (L11) Flashcards
1
Q
properties of technology
A
monotonic
free disposal
free lunch
convex, when tech production function is concave
2
Q
TRS
A
technical rate of substitution
how much of one that you need relative to the other to keep output the same
-MPL/MPK=-aK/bL
3
Q
returns to scale
A
increasing if t^a+b >1
constant if t^a+b=1
decreasing if t^a+b <1
4
Q
monotonic
A
more input = more output
5
Q
free disposal
A
(if too much is made you can throw it away)
6
Q
free lunch
A
no input no output
