Assume that a noncompetitive firm's short run production function relates the level of output to labor input with the capital input fixed at K* Q=f(L,K* )= 40L - 2Ľ² for L<20 This firm faces the following demand function for its product 8500 - 350 P - The firm pays a wage of $70 per unit and has $5000 of fixed cost. a) What is the firm's profit maximizing level of output, price, and employment? b) What is the firm's profit or loss?

Assume that a noncompetitive firm's short run production function relates the level of output to labor input with the capital input fixed at K* Q=f(L,K* )= 40L - 2Ľ² for L<20 This firm faces the following demand function for its product 8500 - 350 P - The firm pays a wage of $70 per unit and has $5000 of fixed cost. a) What is the firm's profit maximizing level of output, price, and employment? b) What is the firm's profit or loss?

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

See similar textbooks

Similar questions

Consider a price-taking firm whose production function is given by q = 3 (L-9) ¹/5 (K-5)¹/⁹ where L and K denote respectively the amount of labour and capital the firm uses to produce q units of output. Suppose the price of labour is w = 16, the price of capital is 24 and the price of the firm's output is p=225. Enter below the value of the firm's fixed cost.
Assume a firm has the following short-run production function: q(L) = L + 2L² ), what is the lowest level of labor ( ) they would employ? Given the production function above, answer the following two questions: A) If this firm is going to maximize profits in the short-run by producing a strictly positive level of output ( Minimum level of labor = ) a wage of $10 ( 9>0 ), what must be the price ( L B) Now suppose the firm must pay each unit a labor ( Price = dollars L w = 10 - ). If this firm is maximizing their profits in the short-run by hiring 4 units of labor ( -L³ L = 4 3 Р ) that they can charge for each unit of output they produce?
25) If a firm has the cost function C(q) = 5q² + 20q + 180 and the marginal cost function MC(q) = 10q + 20, at what quantity is its average cost minimized?
Law of diminishing returns......
12. A firm’s production is represented by the following function: Q = L0.4 K0.6 . The rental rate of capital (r) is $30 and the wage rate (w) is $5. For a given level of output, what should be the ratio of capital to labor in order to minimize costs? How much capital and labor should be used to produce 600 units of output? What is the total cost? What is the short run total cost if output is decreased to 300 units? What would be the optimal choice of capital and labor in the long run in order to produce 300 units of output? What is the long-run total cost? Does this production function exhibit increasing, decreasing, or constant returns to scale? Please answer based on the cost calculations in parts c and d.
2. A production process using two inputs, labor and capital is Q = 5LK where Q is output per day. MPK = 5L and MPL = 5K. The wage (w) = $150 per hour and (r) = $1,000 per hour. Determine the least cost combination of K and L when the desired output is 1,000 What is the minimum cost of producing 1,000 per day?
!
None
Assume a firm's short-run cost function is given by the following expression: C(q) = 2+q+q2 If the firm can sell each unit of their output at a price of p=9 dollars, what is the maximum profit the firm can earn in the short-run? a.) Maximum Profit = ? dollars
A manufacturer of upholstery can sell 2121 yards of fabric at a price of $3.11$⁢3.11 per yard. If the price is $1.85$⁢1.85, she can sell 3535 yards. The total cost of manufacturing x yards of fabric is C(x)=0.6x+36C(x)=0.6x+36 dollars. Step 1 of 3 : Assuming the demand function is linear, find an equation for D(x)D(x). Do not round your answer.
BJO Ⓒ4 f(X₁, X₂) = (x₁² + X₂²) & 0
Suppose a firm has the following expenditures per day: $250 for wages and salaries, $50 for materials, $60 for equipment, and $40 for rent. The market wage for the manager is $120 per day but the owner-manager does not draw a salary. Assume the daily revenue is $420. What is the accounting profit for the firm described above? Just give equation formula.