5. A company that produces auto parts has a production function of Q = 300 L-75 K-5.%3DIf L= 250 and K= 25, what is the output of auto parts?If L increases to 350, what is the output of auto parts?What does the change in output show regarding labor as a factor of production?

(i) Q=300L0.75K0.5L=250K=25Now,Q=300(250)0.75(25)0.5 Q=300×62.87×5Q=94,305

Answered: 5. A company that produces auto parts…

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

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5. A company that produces auto parts has a production function of Q = 300 L-75 K-5. %3D If L= 250 and K= 25, what is the output of auto parts? If L increases to 350, what is the output of auto parts? What does the change in output show regarding labor as a factor of production?