2. Suppose a production function is q = K¹/21/3 and in the short run capital (X) is fixed at 100. If the wage is $10 and the rental rate on capital is $20, the short run production function is a.q=10z¹/3 b. g=1002¹/3 C. -1/3 q= 10 d. g=100

2. Suppose a production function is q = K¹/21/3 and in the short run capital (X) is fixed at 100. If the wage is $10 and the rental rate on capital is $20, the short run production function is a.q=10z¹/3 b. g=1002¹/3 C. -1/3 q= 10 d. g=100

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

See similar textbooks

Related questions

Q: 2) Assume a firm has the following production function 4 = K³L%¸ Assume w = 2, v = 16 and that K =…

A: In short-run, capital is kept fixed and labor can vary Profit maximizing quantity of labor occurs at…

Q: 1. Suppose that a firm uses inputs labour (L, measured in person hours) and capital (K, measured in…

A: The production function is given as L is the measurement of labor in person hours.K is the…

Q: If the current capital is fixed at 1,600 units, how much labor should the firmn employ in the short…

A: Meaning of Production Function: The term production refers to the situation when the product…

Q: 13. Suppose you have a production technology given by f(x1,x2) = min{2r1, r2} and you are producing…

A: In a market, when a firm produces a product, it requires various input resources like labor, raw…

Q: Which of the following are true (check all that apply) Note: IRTS=increasing returns to scale,…

A: Cobb-Douglas production function represents the relationship between the inputs used and the total…

Q: A firm produces output according to a production function: Q=F(K,L) = min (4K,8L). a. How much…

A: A production function exhibits the relationship between the inputs and the output. There are various…

Q: 93) Explain the difference between the short run and the long run as it relates to the firm's…

A: “Since you have asked multiple questions, we will solve the first question for you. If you want any…

Q: Consider the production function Q = 6K//3L/2, where Q, K, and L denote the quantities of output,…

A: Profit = TR – TC TR = P*Q TC= wL + r K w = 12, r = 0.16, so, TC= 12L + 0.16 K The profit function as…

Q: Charlie's Umbrellas has a production function given by Q = L0.5K0.5. The wage (W) is $80 per day and…

A: There are many factor of production , Land and Labor is the part of those factor , here we calculate…

Q: Let's assume that a firm's total weekly costs are as follows: 1. Salaries = $5000. 2. Supplies =…

A: Accounting profit refers to the net income of a business as calculated using the generally accepted…

Q: What is the profit maximizing amount of labor that Belfast Company should hire?

A: Profit maximization is the process by which a firm determines the price, input, and output levels…

Q: 6. Suppose the wage is $8, the rental rate of capital is $128, and the firm's CRS Cobb-Douglas…

A: Cobb–Douglas production function is the production function which represent the relationship between…

Q: Helen produces first-aid kits using labor and capital with the production function q= 6L0.8 K0.2,…

A: Production function: Short-run total cost function: The wage rate is 5 and the rental rate for…

Q: The production function of a firm is estimated to be Q=f(K,L)= KL + L. Market conditions require…

A: Production function: Q=f(K,L)=KL+LK denotes capital and L denotes labor. Q is the total output.Wage…

Q: 3. Suppose a production function is q = K¹2113 and in the short run capital (K) is fixed at 100. If…

A: The production function is given as The short run fixed cost is $100.The wage rate is $10.The rental…

Q: A firm produces output according to a production function: Q = F(K,L) = min {6K,2L}. a. How much…

A: What is the production function?A production function is akin to a recipe, indicating the output a…

Q: b) Suppose a business faces a production function which is of the Cobb-Douglas form: Q(L, K) = ALªKB…

A: We have cobb double production function with alpha and beta as parameters.

Q: Solve the attachment.

A: Increasing returns to scale refers to situation when percentage change in input is lower than…

Q: Let the hourly production function for Fred's Fountains be the following: .251.5 The rental rate of…

A: “Since you have posted a question with multiple sub-parts, we will solve the first three sub-parts…

Q: Let in the long run production function is TP LK. If Price of labor (wage per hour) is 20 birr and…

A: The output maximization would result in the fact when the marginal rate of substitution of of…

Q: Suppose a production function is q = K1/2L1/3 and in the short run capital (K) is fixed at 100. If…

A: The objective of the question is to find the fixed cost in the short run given the production…

Q: = 2L + K. The wage for a Suppose that a firm has the following production function: q worker is w =…

A: The following problem of minimization of cost is solved as follows:

Q: A firm has the production function Q = 20K0.210.8, where Q measures output, K represents machine…

A: Production function: Q = 20K0.2L0.8Rental rate of capital (R) = $15Wage rate (W) = $10The firm wants…

Q: Find the cost minimizing combinations of capital and labor a firm should employ in the following…

A: Given production function: q=K1/2L1/2 .......... (1) Let w be the wage rate and v is the cost…

Q: Consider the following production function: Q = (1-x-1)yk. Assume we are dealing with the short run,…

A: A production function is a concept used in economics to describe the relationship between inputs…

Q: 3. A firm has a production function, q = k0.5 10.5, where q is daily output (in kilogram) and I and…

A: We are given: Production function: Q = k0.5 l0.5k = 40 (as it is short run)Per unit cost of capital…

Q: Q₂ A production function is given by q = 500L + 700K. The price of capital is $120 and the price of…

A: Cost minimization problem of producer: For the given output level the firm and per unit cost of…

Q: 1. Suppose that a producer has the following production function: Q = K LU6 Where Q is output, and L…

A: Given Q = K1/3. L1/6 Cost minimization: q(K,L) = Lβ.KαSo that MPL=βLβ-1.Kαand, MPk = αLβ.Kα-1Let, α…

Q: 3. A firm’s production function is q = 8K.25L.75 MPL = 6 K.25L-.25 MPK = 2 K-.75L.75 a. Determine…

Q: A firm has the following production function: q = L - K Assume the firm must pay each unit of labor…

A: In the short run, capital is fixed but in the long run all inputs are variable.In the long run, cost…

Q: A firm produces output according to a production function: Q = F(K,L) = min {6K,2L}. a. How much…

A: Production function: Q = min {6K , 2L} Where Q is the quantity produced, K is capital and L is…

Q: Suppose a firm faces the input prices of labor and capital of w = $15 and r = $2, respectively. The…

A: Production function = 4K0.5L0.5 w = 15 r = 2 K = 400 At optimum, MPL/MPK = w/r (2*K0.5*L-0.5 ) / (2*…

Q: d. Does capital obey the "law of diminishing returns?" Explain. e. Suppose that firm wants to…

A: Given: Production function: Q=K1/2L1/2 Price of K=$8 Price of L=$2 Note: Due to multiple subparts…

Q: g. Now suppose that firm is faced with the same problem as in (e and f) except that firm has a fixed…

A: Given: Production function: Q=K1/2L1/2 Price of K (R)=$8 Price of L (W)=$2

Q: 4. A firm has production function q = KL. The wage and rental rates are both 10. Does this…

A: The production function is a concept in economics that describes the relationship between inputs and…

Q: A firm has the production function q = K0.25L0.25 , where K is capital, L is labor, and q is output.…

A: ***Since the third subpart of the question has not been mentioned clearly, so, the expert has solved…

Q: A firm produces output according to the production function: Q=F(K.L) = 4K - 8L a. How much output…

A: A firm will minimise its cost at a point where marginal rate of technical substitution is equal to…

Q: Concentrate on the following production function: 10KL Q K+L Suppose w = Php 1, r = Php 4, and K = 4…

A: "A production function depicts a relation between inputs involved in the production process and…

Q: 1. Assume that the production of wine requires land (T) and labor (L) and it follows diminishing…

A: The diminishing returns to scale means that each added input (labor) will result in a decreasing…

Q: 1. Assume a daily production function for a firm is Q=min(3L, 4K) a. If L 100 and K = 100 what…

A: Here we calculate the followings terms of production and cost by using the given information and…

Q: A firm’s production function is Q = L1/2 K1/2 They have 16 units of capital (which is fixed in the…

A: Given Q =L1/2K1/2 ...... (1) In short-run K = 16 (fixed) Cost of labour =2 and cost of capital =…

Q: Suppose a firm producing wood burning stoves has the following production function Q(K, L) = 4K…

A: Production function is the mathematical expression of the amount of output a system or firm produces…

Q: 5. Selpats produces pens with the production function f (k,l) = 200Vkl. The price of capital is wK =…

A: Given production function Y=200KLPrice of Capital=40Price of Labor=10

Question

2. Suppose a production function is q = K¹211/3 and in the short run capital (K) is fixed at 100. If the wage is $10 and the
rental rate on capital is $20, the short run production function is
a. q = 10/¹/3
b. g=1002¹/3
C.
1
q= = -11/3
10
d. g = 100

Expert Solution

This question has been solved!

Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.

This is a popular solution!

SEE SOLUTION Check out a sample Q&A here

Step 1: State the information given

VIEW

Step 2: Determine short run production function

VIEW

Solution

VIEW

Trending now

This is a popular solution!

Step by step

Solved in 3 steps with 3 images

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, economics and related others by exploring similar questions and additional content below.

Similar questions

2
Assume that you have the following production function and input prices in the long run: 2 2 3 2 3 3 2 8 4 MPL K L MPK KL Y K L w r Continue to assume that the firm uses an input bundle of (8, 10). How much does this bundle cost? COST = __________
With a production function like Y=zN, which of the following must be true at the optimum? A).The marginal product of labor is smaller than real wage. B).The marginal product of labor is bigger than real wage. C).The representative firm makes positive profits. D). Profits of the representative firm are zero.
Economics Suppose that firms face the following production function: Q = L + K + 2L ^ (1/2) * K ^ (1/2) This production function exhibits information that is not enough to determine Returns to Scale Increasing Returns to Scale Decreasing Returns to Scale Constant Returns to Scale
Suppose the long-run production function for a competitive firm is f(x1,x2)= min {x1,2x2}. The cost per unit of the first input is w1 and the cost of the second input is w2. .a. Find the cheapest input bundle, i.e. amount of labor and capital, that yields the given output level of y. .b. Draw the conditional input demand functions for labor and capital in the x1-y and x2- y spaces. .c. Write down the formula and draw the graph of the firm’s total cost function as a function of y, using the conditional input demand functions. What is the relationship between the returns to production scale and the behavior of the total costs? .d. Write down the formula and draw the graph of the average cost function, as a function of y. .e. Write down the formula and draw the graph of the marginal cost function, as a function of y.
Could you please help me with this question? Thank you!
1. Given the production function: q = 2KL, (a) Fill in the table below which has information on the short-run production function, the marginal product of labor (MPL), and the average product of labor (APL) if capital is held fixed at 3 units in the short-run. Labor Quantity of Output (MPL) (APL) 0 1 4 9 16 25 (b) Plot the short-run production function. (c) Plot the marginal and average products of labor on a new graph. (d) Does the law of diminishing marginal returns apply? If so, at what level of labor do diminishing marginal returns set in? (e) What is the relationship between the marginal product of labor (MPL) and the average product of labor (APL)? (f) If the amount of capital increased to 6 units, what would happen to your graphs in part C)?
10. If over the range of positive marginal product, the short-run total product of factor A in the production of X is given by the equation: X=aA +b A2 – A3 Where a, and b are positive constants, and if the average product of A is maximized when X=100, then the marginal product of A must be greater than the average product when X=50. True or False ?. Prove your answer.
Question i A firm has a production fùnction given by Q = AL" K# and per unit prices of capital (K) and labour (L) are r and w respectively. %3D a. Find the Marginal Rate of Technical Substitution of labour for capital for this firm b. Ifthe firm seeks to minimize its cost and it is in the short run of production such that K = K find L and the short run cost function c. Suppose that the firm can now change all its inputs and it seeks to minimize its cost. Find the input demand functions for K and L; as well as the long run cost function
Ma4. A firm produces output with the production function, Q = F(K, L) = K0.5L0.5 with r=4 and w= 2. The firm is using K=16 and just enough L to produce 16 units of output in the short run. How much could the firm save if it were producing 16 units in the long run?
Suppose the representative firm of the economy has a production function of the form F(K, N) = AKO.5N 0.5 The marginal product of labor is then given by MP N = 0.5AK0.5N –0.5 . The current capital 3. stock is K = 40. (a) Holding fixed capital at 40, draw a graph of output as a function of labor. What are some important features of this graph? (b) If A = 4 what is the Labor Demand Curve, ND(w), as a function of the real wage w? (c) Suppose labor is supplied inelastically with NS(w)= 10. What is the equilibrium wage w, employment level N, and full employment output Y ? (d) Suppose that productivity unexpectedly increases to A = 6. What is the new equilibrium wage w, employment level N, and full employment output Y ? (e) Depict this change graphically. Denote the original labor supply and demand curves by NS and ND respectively. Denote the new labor demand curve after the productivity shock by ND' . (Does not need to be to scale).
1. Suppose the production function is Q = 8L + 15K where Q is the quantity of output, L is the quantity of labor used in production, and K is the quantity of capital used in production. What can be said about this production function? It has Decreasing Returns to Scale It has Constant Returns to Scale It has Increasing Returns to Scale There isn’t enough information to determine the Returns to Scale for this production function 2. You’re dreaming of what to do during a nice summer day. You could mow the lawn which you would pay someone $15 to do for you. You could go for a walk which you value at $11. You could also take a nap and ignore everyone and everything else which you would pay $29 to do. If you to take a nap, what is your opportunity cost? Group of answer choices $29 $26 $15 $11