Question

Suppose a monopolist has a production function given by Q = L1/2K1/2. Therefore,MPL = , and...

Suppose a monopolist has a production function given by Q = L1/2K1/2. Therefore,MPL = , and MPK = 2/12/12LK2/12/12KLThe monopolist can purchase labor, L at a price w = 16, and capital, K at a price of r = 9. The demand curve facing the monopolist is P = 360 – 2Q.a) (8 points) What is the monopolist’s total cost function? b) (4 points) How much output should the monopolist produce in order to maximize profit?c) (6 points) How much labor should the firm hire to produce this output?d) (4 points) How Much Capital should the firm hire? e) (4 points) What price should the monopolist charge?f) (4 points) What is the deadweight loss?g) (4 points) What is the Price Elasticity of Demand at the profit-maximizing price and quantity?

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
Suppose a monopolist has a production function given by Q = (L^1/2)/(K^1/2). Therefore, MPL =( k^1/2)...
Suppose a monopolist has a production function given by Q = (L^1/2)/(K^1/2). Therefore, MPL =( k^1/2) / 2(L^1/2) , and MPK =(L^1/2) / 2(k ^1/2)The monopolist can purchase labor, L at a price w = 16, and capital, K at a price of r = 9. The demand curve facing the monopolist is P = 360 – 2Q. a) (8 points) What is the monopolist’s total cost function? b) (4 points) How much output should the monopolist produce in order...
Suppose a firm’s production function is given by Q = L1/2*K1/2. The Marginal Product of Labor...
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?...
a. A cost minimizing firm’s production is given by Q=L1/2K1/2. Suppose the desired output is Q=10....
a. A cost minimizing firm’s production is given by Q=L1/2K1/2. Suppose the desired output is Q=10. Let w=12 and r=4. What is this firm’s cost minimizing combination of K & L? What it the total cost of producing this output? b. Suppose the firm wishes to increase its output to Q=12. In the short run, the firm’s K is fixed at the amount found in (a), but L is variable. How much labor will the firm use? What will the...
Answer the following questions about the producer’s production function: Q = 2K1/2L2 Does the production function...
Answer the following questions about the producer’s production function: Q = 2K1/2L2 Does the production function display increasing, constant, or decreasing returns to scale? [Prove your answer by increasing all inputs by a factor of c in your analysis.] Find MPL if capital is fixed at K0=9 and determine whether the production process follows the law of diminishing returns (LDR) to labor. If input prices are r=5 and w=4 for capital and labor, respectively, and suppose MPK=40 and the firm...
Suppose that a firm's production function is Q = 10L1/2K1/2. The cost of a unit of...
Suppose that a firm's production function is Q = 10L1/2K1/2. The cost of a unit of labor (i.e. the wage) is $20 and the cost of a unit of capital is $80. a. What are the cost minimizing levels of capital and labor if the firm wishes to produce 140 units of output? b. Illustrate your answer for part (a) on a well-labeled diagram that shows the firm's production isoquant and isocost equation.
Suppose the production function for new iPhones is Q = 17L0.3K0.8 and MPL = 5.1L-0.7K0.8 and...
Suppose the production function for new iPhones is Q = 17L0.3K0.8 and MPL = 5.1L-0.7K0.8 and MPK = 13.6L0.3K-0.2. a.What is the equation (in terms of K and L) for the average product of labor for this production function? b.What is the equation for the MRTSLK for this production function? Simplify. c.If the isocost line for this firm is C = 12L + 8K, what is the rental rate for capital? d.If the MRTSLK is 2.33 when output is 276...
2. Suppose the demand function for a monopolist’s product is given by: Q = 80 –...
2. Suppose the demand function for a monopolist’s product is given by: Q = 80 – 5P (Total marks = 5) and the cost function is given by C = 30 + 2Q + 0.5Q2 A) What is the inverse demand function for this monopoly? B) Calculate the MC. C) Calculate the MR. D) Determine the profit-maximizing price. E) Determine the profit-maximizing quantity. F) How much profit will the monopolist make? G) What is the value of the consumer surplus...
Q1. A monopolist has the following demand function and marginal cost function P = 120 –...
Q1. A monopolist has the following demand function and marginal cost function P = 120 – Q and MC = 30 + Q. i. Derive the monopolist’s marginal revenue function. ii. Calculate the output the monopolist should produce to maximize its profit. ii. (continuation) iii. What price does the monopolist charge to maximize its profit? Now assume that the monopolist above split into two large firms (Firm A and Firm B) with the same marginal cost as the monopolist. Let...
A firm has the production function: Q = L 1 2 K 1 2 Find the...
A firm has the production function: Q = L 1 2 K 1 2 Find the marginal product of labor (MPL), marginal product of capital (MPK), and marginal rate of technical substitution (MRTS). Note: Finding the MRTS is analogous to finding the MRS from a utility function: MRTS=-MPL/MPK. Be sure to simplify your answer as we did with MRS. A firm has the production function: Q = L 1 2 K 3 4 Find the marginal product of labor (MPL),...
A firm produces an output with the production function Q=K*L2, where Q is the number of...
A firm produces an output with the production function Q=K*L2, where Q is the number of units of output per hour when the firm uses K machines and hires L workers each hour. The marginal product for this production function are MPk =L2 and MPl = 2KL. The factor price of K is $1 and the factor price of L is $2 per hour. a. Draw an isoquant curve for Q= 64, identify at least three points on this curve....
ADVERTISEMENT
Need Online Homework Help?

Get Answers For Free
Most questions answered within 1 hours.

Ask a Question
ADVERTISEMENT