Question

Suppose Bob’s electric bike shop has the following production function: ? = 15?^0.25?. Bob has $10,000...

Suppose Bob’s electric bike shop has the following production function: ? = 15?^0.25?. Bob has $10,000 to spend on the production of electric bikes. He pays his workers a wage of $10 and his capital costs are $50. If Bob wants to build as many bikes as he can with the $10,000, how many employees and capital should Bob employ? How many e-bikes can Bob produce?

Business   Economics   
0 0
Add a commentTranscribed image text
Next >

Homework Answers

Answer #1

0 0
Know the answer?
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Log In

Sign Up

Not the answer you're looking for?
Ask your own homework help question
Similar Questions
6. Suppose Bob has an income of $500, the price of a bike bell is $2,...
6. Suppose Bob has an income of $500, the price of a bike bell is $2, and the price of bike light is $100. Which of the following bundles is in Bob’s opportunity set? A) 50 bike bells, five bike lights B) 200 bike bells, two bike lights C) 100 bike bells, one bike lights D) 150 bike bells, three bike lights 7. Suppose Bob and Rob consume e-bikes and scooters. Bob and Rob face the same prices and both...
1. Suppose Bob has income of $18,000. There is a 20% chance that Bob will get...
1. Suppose Bob has income of $18,000. There is a 20% chance that Bob will get sick and have to spend $10,000 of his income on a treatment. Suppose Bob’s income-utility relationship is given by:    Where I is Bob’s income. U(I) = square root I Complete the table below to find Bob’s total certain utility for various levels of wealth, along his marginal utility associated with increases in his wealth. Wealth Certain Utility Marginal Utility = change in utility...
Suppose the production function for Alfredo Barbua, a maker of fine violins, is given by Q...
Suppose the production function for Alfredo Barbua, a maker of fine violins, is given by Q = 0.5K0.5L0.5. A) If Alfredo is currently using 1 unit of capital, how many violins will he produce if his workers work for 4 hours? B) If the wage rate is $20 and rental rate is $15, what is Alfredo’s cost minimizing ratio of labor to capital? C) Alfredo needs to supply an orchestra with as many violins as he can, but his costs...
Suppose the production function for Alfredo Barbua, a maker of fine violins, is given by Q...
Suppose the production function for Alfredo Barbua, a maker of fine violins, is given by Q = 0.5K0.5L0.5. A) If Alfredo is currently using 1 unit of capital, how many violins will he produce if his workers work for 4 hours? B) If the wage rate is $20 and rental rate is $15, what is Alfredo’s cost minimizing ratio of labor to capital? C) Alfredo needs to supply an orchestra with as many violins as he can, but his costs...
Suppose a business estimates his production function to be ?? = ?? ^0.25?? ^0.75 where Q...
Suppose a business estimates his production function to be ?? = ?? ^0.25?? ^0.75 where Q is the output, K amount of capital and L is amount of labor. Price of labor (wage rate) is $10 and price of capital is $15. (a) Calculate the slope of isoquant curve. (b) Calculate the slope of isocost curve. (c) Suppose the firm wants to produce 100 units of output. Find the optimal combination of labor and capital.
Consider an ice cream company with two stores. Each store has the same production function 2L^(0.5)*...
Consider an ice cream company with two stores. Each store has the same production function 2L^(0.5)* K^(0.5), where K is the number of ice cream machines and L is the number of workers. Store 1 has 4 machines, whereas Store 2 has I machine. a) If the ice cream company employs 20 workers then how many should it employ at each shop? b) Is it better to employ another worker, or purchase another ice cream machine for Store 2? Assume...
A firm has modeled its production function, with 6 units of capital already deployed. The production...
A firm has modeled its production function, with 6 units of capital already deployed. The production function is: q=8L-2L The firm has also modeled its marginal profit function as: mpq=q3-25q2+206q-560 The firm has three options as to how the quantity it can produce that can potentially maximize its profits in the short run. The firm can elect to supply 7 million units, 8 million units, or 10 million units. In other words, q=7 or q=8 or q=10. How many widgets...
A small company produces two goods, swords and plowshares. The company has 100 type alpha employees...
A small company produces two goods, swords and plowshares. The company has 100 type alpha employees and 100 type beta employees. If an alpha devotes all his time to producing swords, he can make 2 swords per week. If he devotes all his time to producing plowshares, he can make 4 plowshares per week. A beta can produce either 1 plowshare per week or 1 sword per week. The company wants to produce 218 swords and as many plowshares as...
2.   Bridgestone Company has the following production function for tires: Q = 20 K 0.2 L...
2.   Bridgestone Company has the following production function for tires: Q = 20 K 0.2 L 0.8, where K represents machine hours and L represents labor hours. They pay $ 15 per hour to rent their machines and $ 10 per hour to their workers. They have $ 12,000 to spend on capital and labor. A. Does this production function exhibit constant, increasing, or decreasing returns to scale? B. Does this production function exhibit diminishing marginal returns to capital and...
4. Suppose a small oil drill has the following production function F(K,L) = min(4K,L) where every...
4. Suppose a small oil drill has the following production function F(K,L) = min(4K,L) where every drill (captial unit) takes 4 people to operate. Output is measured in barrels. (a) Suppose there are 10 drills in the oil field. How many workers are needed to produce 40 barrels of oil (q=40)? (b) Graph the isoquant curves that represent q=20, q=40, and q=60. (c) Setup the cost minimization problem where labor and capital are flexible. Then find the cost function if...
ADVERTISEMENT
Need Online Homework Help?

Get Answers For Free
Most questions answered within 1 hours.

Ask a Question
ADVERTISEMENT