Problem
Suppose a firm's production function initially took the form Q = 500(L + 3K ). However, as a result of a manufacturing innovation, its production function is now Q = 1,000(0.5L + 10K ).
a) Show that the innovation has resulted in technological progress in the sense defined in the text.
b) Is the technological progress neutral, labor saving, or capital saving?
The response should include a reference list. Double-space, using Times New Roman 12 pnt font, one-inch margins, and APA style of writing and citations.