Question

suppose a production function is given by Q= 10K + 2L. The factor price of labor is 1. Draw the demand curve for capital when the firm is required to produce Q=80

Answer #1

Suppose a firm’s production function is given by Q = L1/2*K1/2.
The Marginal Product of Labor and the Marginal Product of Capital
are given by:
MPL = (K^1/2)/2L^1/2 & MPK = (L^1/2)/2K^1/2)
a) (12 points) If the price of labor is w = 48, and the price of
capital is r = 12, how much labor and capital should the firm hire
in order to minimize the cost of production if the firm wants to
produce output Q = 10?...

1. Suppose a short-run production function is described as Q =
2L – (1/800)L^2 where L is the number of labors used each hour. The
firm’s cost of hiring (additional) labor is $20 per hour, which
includes all labor costs. The finished product is sold at a
constant price of $40 per unit of Q.
a. How many labor units (L) should the firm employ per hour
b. Given your answer in a, what is the output (Q) per hour...

Firm B’s production function is q = min {8L,
10K} where L is the quantity of labor and
K is the quantity of capital used to produce output
q. Let PL and PK
denote price of labor and price of capital, respectively. Derive
Firm B’s long-run total cost function. Show your work.

2. A firm has production function Q = k^1/2L^1/2 and faces a
wage for the labor input w = 1 and a rental price of capital r =
9
a. The policy of the Federal Reserve brings the rental price of
capital to r = 4 Graph the change of the cost minimizing equlibrium
explaining the type of substitution that is happening.
b. Compute the new cost function. Suppose a monopoly and show
graphically if after this change in the...

The firms production function is: Q=2L^2/3 K^1/3
A) Suppose the firm wants to determine the cost minimizing
combination for L and K for any given values of q, w, and r. Solve
for the the firms factor demand functions for L and K (i.e. express
the optimal quantity of L and K in terms of W, r and Q)
B) Using these factor demand functions, solve for the firm's
long run cost function.

A firm’s production function is Q = min(K , 2L), where Q
is the number of units of output produced using K units of capital
and L units of labor. The factor prices are w = 4 (for labor) and r
= 1 (for capital). On an optimal choice diagram with L on the
horizontal axis and K on the vertical axis, draw the isoquant for Q
= 12, indicate the optimal choices of K and L on that isoquant,...

1. Production function: Q= 2K^2L
a. Find MRTSLK
b. Interpret MRTS(LK) when capital is 12 and labor is 2?
c. Is the firm able to produce more when making this
substitution?

A firm has the production function: Q= 10K^.5L^.5 If the firm
has 36 units of capital (K), how much labor is needed to produce
240 units of output?

Suppose a firm has a production function q = f(L, K) =2L + 4K,
and the factor prices are w = $2 and r = $2. What is the minimum
cost at which the firm is able to produce 20 units of output?
a. $10 b. $30 c. $45 d. $100 e. $50
please explain why

Suppose the production function is given by formula Q = KL.
A) Draw the isoquant curve for Q = 128. (Draw K on the vertical
axis and L on the horizontal axis.)
B) Suppose K = 4. How many units of labor should the firm use if
it wants to produce 128 units of output? Label it point X on the
isoquant curve.
C) Suppose K = 8.How many units of labor should the firm use if
it wants to...

ADVERTISEMENT

Get Answers For Free

Most questions answered within 1 hours.

ADVERTISEMENT

asked 15 minutes ago

asked 31 minutes ago

asked 35 minutes ago

asked 46 minutes ago

asked 48 minutes ago

asked 53 minutes ago

asked 1 hour ago

asked 1 hour ago

asked 1 hour ago

asked 1 hour ago

asked 1 hour ago

asked 1 hour ago