At L=97, K=96, the marginal product of labor is 4 and the marginal product of capital is 6. What is the marginal rate of technical substitution (labor measured on the horizontal axis)? (Enter a numeric response using a real number rounded up to two decimal places.) The marginal rate of technical substitution is
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In this case, we are measuring the MRTS of labor measured on the horizontal axis. The MRTS is calculated by taking the ratio of the marginal product of labor to the marginal product of capital. So in this case, the MRTS of labor measured on the horizontal axis Show more…
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