Answer to Question #220348 in Microeconomics for tim

Question

Determine the elasticity of substitution of the Constant Elasticity of Substitution (CES) production function given below by obtaining its degree of homogeneity. 

Answer 1

Elasticity of substitution tends to represent isoquant's curvature, which is the substutability degree between the inputs. However,Constant elasticity of substitution, tends to be utility and production function's property. It specifically develops in respective arises aggregator function type that combines production inputs or consumption goods into aggregate quantity.