Question

A price-taking firm has production function: ?? = ??????/??????/?? This is a long-run problem. Labor and...

A price-taking firm has production function: ?? = ??????/??????/?? This is a long-run problem. Labor and capital cost w and r, respectively. Show that the long-run Total Cost function is ???? = ?? ?? ?? ???? ??/?? ??

Homework Answers

Know the answer?
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Not the answer you're looking for?
Ask your own homework help question
Similar Questions
A price-taking firm has production function: q41/4K1/4 This is a long-run problem. Labor and capital cost...
A price-taking firm has production function: q41/4K1/4 This is a long-run problem. Labor and capital cost w and r, respectively. Show that the long-run Total Cost function is TC-2 (rw Hint:This is just like the consumption problem where you derive the Hicks demand functions then the expenditure function
a firm produces a product with labor and capital as inputs. The production function is described...
a firm produces a product with labor and capital as inputs. The production function is described by Q=LK. the marginal products associated with this production function are MPL=K and MPK=L. let w=1 and r=1 be the prices of labor and capital, respectively a) find the equation for the firms long-run total cost curve curve as a function of quantity Q b) solve the firms short-run cost-minimization problem when capital is fixed at a quantity of 5 units (ie.,K=5). derive the...
A firm produces a product with labor and capital. Its production function is described by Q...
A firm produces a product with labor and capital. Its production function is described by Q = min(L, K). Let w and r be the prices of labor and capital, respectively. a) Find the equation for the firm’s long-run total cost curve as a function of quantity Q and input prices, w and r. b) Find the solution to the firm’s short-run cost minimization problem when capital is fixed at a quantity of 5 units (i.e., K = 5). Derive...
A firm’s production function is Q! = min(4L ,5K ). The price of labor is w...
A firm’s production function is Q! = min(4L ,5K ). The price of labor is w and the price of capital is r. a) Derive the demand function of labor and capital respectively. How does the demand of capital change with the price of capital? b) Derive the long-run total cost function. Write down the equation of the long-run expansion path. c) Suppose capital is fixed at K = 8 in the short run. Derive the short-run total cost function....
A hat manufacturing firm has the following production function with capital and labor being the inputs:...
A hat manufacturing firm has the following production function with capital and labor being the inputs: Q = min(5L,3K) (it has a fixed-proportions production function). If w is the cost of a unit of labor and r is the cost of a unit of capital, derive the firm’s optimal inputs, long-run total cost curve, average cost curve, and marginal cost curve in terms of the input prices and Q. b) A firm has the linear production function Q = 2L...
Suppose a firm has a production function given by q = 3L + K. The firm...
Suppose a firm has a production function given by q = 3L + K. The firm can purchase labor, L at a price w = 24, and capital, K at a price of r = 5. What is the firm’s total cost function?
A firm produces output according to the production function. Q=sqrt(L*K) The associated marginal products are MPL...
A firm produces output according to the production function. Q=sqrt(L*K) The associated marginal products are MPL = .5*sqrt(K/L) and MPK = .5*sqrt(L/K) (a) Does this production function have increasing, decreasing, or constant marginal returns to labor? (b) Does this production function have increasing, decreasing or constant returns to scale? (c) Find the firm's short-run total cost function when K=16. The price of labor is w and the price of capital is r. (d) Find the firm's long-run total cost function...
2. A firm has production function Q = k^1/2L^1/2 and faces a wage for the labor...
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...
A firm’s production function is Q(L,K) = K^1/2 + L. The firm faces a price of...
A firm’s production function is Q(L,K) = K^1/2 + L. The firm faces a price of labor, w, and a price of capital services, r. a. Derive the long-run input demand functions for L and K, assuming an interior solution. If the firm must produce 100 units of output, what must be true of the relative price of labor in terms of capital (i.e. w/r) in order for the firm to use a positive amount of labor? Graphically depict this...
Given the production function Q=K2L2 and the price of capital and labor as r=4 and w=8,...
Given the production function Q=K2L2 and the price of capital and labor as r=4 and w=8, respectively, if the goal is Q=2500 find the level of capital (K) and labor (L) to minimize cost.
ADVERTISEMENT
Need Online Homework Help?

Get Answers For Free
Most questions answered within 1 hours.

Ask a Question
ADVERTISEMENT