Week 7 - Intro to 3-Space and Partial Derivatives

Question 1

What is the Cobb Douglas function and what does it mean?

Answer 1

F(x,y) = ax^b *y^(1-b), 0<b></b>

Question 2

What does the derivate of the Cobb Douglas function represent?

Answer 2

First partial derivative with respect to x is the marginal productivity of labor
Second partial derivative with respect to y is marginal productivity of capital

Question 3

What is a relative max/min vs an abs max min?

Answer 3

Relative is the max/min on a limit(or relative to the points around it), absolute is the max/min anywhere on the graph (or global min/max)

Question 4

What is the 2nd order condition formula for determining if a point is a min or a max in a multivariable function?

Answer 4

D(x,y) = fxx * fyy - (fxy)^2