Question

1. A Cobb-Douglas production function relates production (????) to factors of production, capital (K), labor (L) and raw materials (????), and an error term (u). The function is given below. ???? = AK β1L β2????β3e u Suppose you have data on production and the factors of production from a random sample of firms with same Cobb-Douglas production function. How would you use regression analysis to estimate the production parameters?

Answer 1

Hello your question is poorly written attached below is the complete question

answer : attached below

Explanation:

Determine how to use regression analysis to estimate the production parameters

step 1 : take log of both sides of the equation

where : Q = quantity , K = capital , L = labor, M = material, u = error , others are coefficients

attached below is the detailed solution