A firm's production function takes the form: Q(L, K) = min {8L, 6K}, where Q represents output and L and K represent labour and capital, respectively and where w and r give the prices of labour and capital. What would be the expression for the firm's marginal costs? MC =w+ / MC = 6r+ 8w MC = MC = W 6w+8r W +²2- 8 6 + 3r 6w+8r MC = Q(+7)

A firm's production function takes the form: Q(L, K) = min {8L, 6K}, where Q represents output and L and K represent labour and capital, respectively and where w and r give the prices of labour and capital. What would be the expression for the firm's marginal costs? MC =w+ / MC = 6r+ 8w MC = MC = W 6w+8r W +²2- 8 6 + 3r 6w+8r MC = Q(+7)

Microeconomic Theory

12th Edition

ISBN:9781337517942

Author:NICHOLSON

Publisher:NICHOLSON

Chapter10: Cost Functions

Section: Chapter Questions

Problem 10.3P

See similar textbooks

Similar questions

Automobile manufacturing is an industry subject to significant economies of scale. Suppose there are four domestic auto manufacturers, but the demand for domestic autos is no more than 2.5 times the quantity produced at the bottom of the long-run average cost curve. What do you expect will happen to the domestic auto industry in the long run?
Would you consider an interest payment on a loan to a film an explicit or implicit cost?
What is the difference between a fixed input and a variable input?
Please answer fast
The Acme Anvil Company's output is given by the Cobb-Douglas Production function P = 60L2/3 K1/3, where P is the number of anvils produced when Lis the amount spent on labor and K is the amount spent on capital. a. What is the production if L = 150 and K = 150? b. Find the marginal productivities. C. Evaluate the marginal productivities with L = 150 and K = 150. d. Interpret the meanings of the marginal productivities found in part c. e. If their budget is $300 then there is a constraint L+ K = 300. Use Lagrange multipliers (2) to find the values of L and K that will maximize production and find the maximum production f. Find 2. 12| is called the marginal productivity of money and will give the number additional units produced for each dollar increase in the budget. Interpret 2 for this problem. MacBook Pro urses/34419/files/5014304?wrap=1
Nimubs, Inc., makes brooms and then sells them door-to-door. Here is the relationship between the number of workers and Nimbus's output during a given day: Workers Output Marginal Product Total Cost Average Total Cost Marginal Cost 0 20 50 90 0 1 2 3 A worker is paid $100 a day, and the company's fixed cost is $200. What is the marginal cost as Nimbus's output increases from 50 brooms to 90 brooms? $3.33 $2.5 $5.56 $100
Given the production function y 1/x05, if Price of output is P and price of input X is V and fixed cost is FC, what is the expression for marginal cost (MC) as a function of Y? O MC = Vy0.5 O MC = -2Vy-3 O MC = Vy-0.5 O MC = y/V
Suppose that the Acme Gumball Company has a fixed proportions production function that requires it to use two gumball presses and one worker to produce 1,000 gumballs per hour. a. Explain why the cost per hour of producing 1,000 gumballs is 2v + w (where v is the hourly rent for gumball presses and w is the hourly wage). b. Assume Acme can produce any number of gumballs they want using this technology. Explain why the cost function in this case would be TC = q(2v +w), where q is output of gumballs per hour, measured in thousands of gumballs. c. What is the average and marginal cost of gumball production (again, measure output in thousands of gumballs)? (show the complete formula) Draw the graph for the average and marginal cost curves for gumballs assuming v=3, w-5 (show working) Now draw the graph for these curves for v=6, w=5.( show working) Explain why these curves have shifted.
Suppose the production function for high quality brandy is given by : Q = √KLWhere q is the output of brandy per week and L is labor hours per week ., in the short run K is fixed at 100, so the short run production function is Q = 10√La. If the capital rents for 10$ and the wage are 5$per hour ., write the short run total cost function. b. How much will the firm produce at a price of 20$ per bottles of brandy ?c. How many labor hours will be hired per week?
The production function for a product is given by q= 10K^(1/2)L^(1/2) where K is capital, and L is labor and q is output d) Now suppose w =30 and r = 120. What is the minimum cost of producing q=1000. (You must show your work by clearly writing the equations that you use to derive the cost minimizing levels of L and K.) e) Now suppose that the firm is in the short run and cannot vary the amount of capital. That is, it must use the same amount of capital as in part d). However, the firm wants to produce 1200 units of output. How much labor should it use to minimize its cost and what is the minimum cost of producing q =1200?
Can you please help solve question 9 d and e please show full working so I can compare it to my own work Thank you
Problem 7. A factory that you are managing has an hourly production process that can be represented by the following Cobb Douglas Production function: Q 20KL The price of one unit of capital per hour is $20 and the price of one unit of labour per hour is $20. You have been instructed to have a total cost of $1,000 or TC $1,000. Find the optimal amount of labour and capital that you will be using, and compute the amount of output..