I need solutions for C and D. I also attached the solution of A question for you. 2. A firm producing hockey sticks has a production function given byq = 2VklThe price of labor is "w", the price of capital is "v". For any given level ofoutput "q":a. Calculate the firm's long-run total, average and marginal cost function.b. Please show the cost function is homogeneous of degree 1 in inputprices.c. Please show the cost function is concave in v.Suppose now that capital used for producing hockey sticks is fixed at "k1" inthe short run.d. Calculate the firm's short-run total costs as a function of q, w, v, and k1. 1)2) The average cost function,At equilibrium or optimal point,AC = C/qSlope of production function = Ratio of the price of inputsMRTS = Price of labor / Price of capitalAC =AC = VVVWdaal.This is the average cost function.The marginal cost function,МС —d CVIviМС —This is the marginal cost function.Ixwk =Put this value in the production function to find the value of the l as a function of g.Consider the production function,9 = 22Vivi9 = 21l =2/wThis is the value of l. Put this value in the k function.k =2 wk =This is the value k.To find the total cost function, put the value of l and k in the C function,C = wl + vkС — wC = ViVw2С —2C = q VvVw

Production function q=2(KL)1/2 W=price of labor V=price of capital q=level of output

2. A firm producing hockey sticks has a production function given by q = 2Vkl The price of labor is "w", the price of capital is "v". For any given level of output "q": a. Calculate the firm's long-run total, average and marginal cost function. b. Please show the cost function is homogeneous of degree 1 in input prices. c. Please show the cost function is concave in v. Suppose now that capital used for producing hockey sticks is fixed at "k1" in the short run. d. Calculate the firm's short-run total costs as a function of q, w, v, and k1.

2. A firm producing hockey sticks has a production function given by q = 2Vkl The price of labor is "w", the price of capital is "v". For any given level of output "q": a. Calculate the firm's long-run total, average and marginal cost function. b. Please show the cost function is homogeneous of degree 1 in input prices. c. Please show the cost function is concave in v. Suppose now that capital used for producing hockey sticks is fixed at "k1" in the short run. d. Calculate the firm's short-run total costs as a function of q, w, v, and k1.

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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