A9. The diagram below depicts a firm's short-run production function and two isoprofit lines (and). If the firm's optimal production point has switched from point B to point A, which of the following must have occurred? Output A. B. C. D. B A TUB ΠΑ Labour a decrease in the price of labour; an increase in profits an increase in the price of labour; an increase in fixed costs; no change in profits a decrease in the price of labour; a decrease in fixed costs; a decrease in profits an increase in the price of labour; an increase in profits

A9. The diagram below depicts a firm's short-run production function and two isoprofit lines (and). If the firm's optimal production point has switched from point B to point A, which of the following must have occurred? Output A. B. C. D. B A TUB ΠΑ Labour a decrease in the price of labour; an increase in profits an increase in the price of labour; an increase in fixed costs; no change in profits a decrease in the price of labour; a decrease in fixed costs; a decrease in profits an increase in the price of labour; an increase in profits

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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1)Suppose that labor is the only variable input to the production process. If the marginal cost of production is diminishing as more units of output are produced, what can you say about the marginal product of labor? Draw diagrams as required. 2)Assume that the marginal cost of production is increasing. Can you determine whether the average variable cost is increasing or decreasing? Explain. Draw diagrams as required. Note. Don't use chat gpt.
Suppose a firm has two plants, A and B, each producing the same product but using different production processes. After analyzing production reports a UNC Charlotte intern realizes that the marginal product of labor in plant B is greater than the marginal product of labor in plant A. What should he recommend as a short-run remedy? a.Move labor from plant A to plant B. b.Move labor from plant B to plant A. c.Add more capital to plant B. d.It cannot be determined from the information given.
Question 1. Suppose a small firm employs Capital (K) and labour (L) at its production of output. The production function of the firm is: q = -56³ + 10L²K + 100LK0.5. Assume that K-25 in the short run. a. What is its short-run production function? b. What are the firm's marginal product of labour and average product of labour in the short run? c. In the short run, when marginal output is maximized, what is the value of L? d. Calculate the short-run elasticity of output with respect to labour when L=10 and K-25 (Hint: the firm's elasticity of output with respect to labour in the short run is a function of marginal product of labour and average product of labour)
Math Econ Question 1 Please help to solve this. Thank you
Show full answers and steps to part d) e) & f)
According to microeconomic theory, an input factor may be: a. Fixed in the short run, but will always be variable in the long run. b. Fixed in the short run, and fixed or variable in the long run. c. Variable in the short run, but will always fixed in the long run. d. Either fixed or flexible in the short run, and either fixed or flexible in the long run.
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PART 2 Question 1 a. The following table summarizes the short-run production functions for "All Needs Firms". The product of “All Needs Firm" sells for 5 GHC per unit, the cost of input X1 is 8 GHC per unit, and the price of input X2 is 25 GHC per unit. Complete the following table, and then answer the associated questions. Please show how you arrive at your answers. X1 X2 Q MPx1 APr1 AP2 1. 5 10 2 30 3 5 60 4 5 80 5 5 90 6 5 95 5 95 8 5 90 5 80 10 5 60 11 5 30 Answer the following questions using information from the above table. 1. Which input is the fixed input? Which is the variable input? 2. How much is the fixed costs? 3. What is the variable cost of producing 30 units of output? 4. Over what range of variable input usage does increasing marginal returns exist? 5. Over what range of variable input usage does decreasing marginal returns exist? 6. Over what range of variable input usage does negative marginal returns exists? b. You are the manager of a firm that sells output at a…
For a decrease in the price of capital (K), construct a table AND explain the scale and substitution effects for a producer.
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Assume a firm is trying to maximize output subject to a budget and is currently in the long run equilibrium shown below. Make changes to the graph to show the impact of a decrease in the wage. Make sure that the graph shows the new output-maximizing combination as well as the new levels labor and capital.