- Thread starter
- #1

- Thread starter zkee
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- Thread starter
- #1

- Feb 29, 2012

- 342

$$g(tx,ty) = \ln \left( \frac{ty}{tx} \right) = \ln \left( \frac{y}{x} \right) = g(x,y).$$

The $t$'s cancel, therefore it makes no contribution. This is a degree zero homogeneous function.

Best wishes,

Fantini.

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- #3

- Mar 5, 2012

- 9,592

Welcome to MHB, zkee!Hey people!

I'm confused as to why the ln(Y/X) part of the numerator is not considered in the calculation of the degree of numerator.

Any help or websites to browse through for the answer would be appreciated!

The degree of y/x is 0.

Or in other words, $\ln(y/x)$ behaves like a constant.