I need help with C. c. There is an increase in the wage rate for automobile manufacturing workers.Labor demandQuantity of workersWage Consider each given scenario and the effect it will have, if any, on GM’s demand for labor in its U.S. automobile factories.In each diagram, make the appropriate adjustment to the graph to illustrate whether the event causes a movement alongGM's demand curve for labor, or a shift in the labor demand curve.a. New advances in technology reduce the cost to GM of machinery used in its manufacturing plants. Assume that thesubstitution effect dominates the scale effect.Labor demandWage

A good rise in wages is an advantage for the consumers but can be expensive for the producers, as…

Answered: c. There is an increase in the wage…

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c. There is an increase in the wage rate for automobile manufacturing workers. Labor demand Quantity of workers Wage

Microeconomic Theory

12th Edition

ISBN:9781337517942

Author:NICHOLSON

Publisher:NICHOLSON

Chapter9: Production Functions

Section: Chapter Questions

Problem 9.10P

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What is the difference between a fixed input and a variable input?
Instructions: Move the slider at the bottom of the diagram to change the quantity of labor hired for both graphs and the table. Move the production slider to 6 units of labor. Suppose you had the information for the L=2 row and the L=6 row, but the row(s) in between them were missing and you didn't have any information in the Marginal Product column. If you wanted to estimate the marginal product, you might assume the marginal products of each of the 4 additional workers are equal. a. Estimate the marginal product of each additional worker if L were to increase from 2 to 6. b. Calculate the slope of the total production function between L=2 and L=6.
Can you help me answer the question g ? Thanks!
Please help me answer d,e,f questions.
The Rocky Mountain Spring Water Company experiences a surge in orders, because the water of one of its major competitors is taken off the market due to news that samples contained benzene. As the Company struggles to increase production of its bottled water, it finds that the marginal product of labor, its only variable input, approaches zero. When the marginal product of labor becomes zero this month, the firm Select one: O a. will still be able to fill additional orders this month without hiring more workers. O b. won't be able to fill any additional orders this month. O c. will achieve maximum output per unit of labor. O d. will be able to fill additional orders this month by hiring more workers.
Tom Petersen is considering renovating bar stools at Dreamland. The productionfunction for new bar stools is given byq= 0.5L0.5where q is the number of stools produced during the renovation week and l represents thea number of worker hours employed during the period. The firm is a price taker for both bar stools(which sell for P) and workers (which can be hired at a wage rate of w per hour).a. What is the cost function for this firm C(w,q)?b. What is the supply function for bar stools q(P,w)?c. What is the profit function for this firm (P,w)?d. What is the firm’s demand function for labor function L(P,w)?
Let the hourly production function for Fred's Fountains be the following: 9=K:25,.5 The rental rate of capital, v, is $80 and the wage rate, w, is $40. In the short run, assuming K = 16, answer the following: а. What is the short run total cost function? b. What is the short run supply function? If the price of fountains is $240, to maximize profit, how much labor С. should they use and what is the level of output and profit? d. Given the above situation, Graph R and SC. What about the graph tells you that the second order conditions for profit maximization are satisfied? Is the firm using the right amount of K and L to minimize cost in the е. lorlg run? How do you know? Now calculate the long-run, quantity contingent, input (or factor) demand functions for K and L. At a price of $240 for fountains, how much K and L should they be using? f. g. Now, for the above scenario, what are the long run profit maximizing input demand functions?
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Saxxon Fifth Avenue's production function is given by Q = L+ K. Let w = 1 and r = 2 be the prices of labor and capital, respectively. (a) Find the equation of Saxxon Fifth Avenue's longrun total cost curve. Hint: Note that labor and eapital are perfect substitutes. (b) Suppose capital is fized at 5 units (i.e., K = 5) in the short run. Derive the equation for Sazzon Fifth Avenue's shortrun total cost curve. For simplicity, assume the fxed cost is sunk. (c) In a graph, draw Saxon Fifth Avenue's short-run total cost curve and longrun total cost curve.
Generate a practice problem based on this example: "The New Age firm produces clean coal. New Age's production function is given by ., where L denotes labor, and S denotes its cutting-edge machinery. The price of labor is given by the wage, w, and machinery price is denoted Ps. Suppose the number of machines is fixed at S= 1 in the short run while w is variable."
I need help with A and B.
1.A 15 per cent increase in all inputs leads to only a 5 per cent increase in the output. Are the returns to scale increasing, constant or diminishing? Illustrate your answer2.What is the slope of an iso-cost line equal to and why? Provide mathematical explanation3.“By definition, cost is zero if a firm does not hire any input. Hence cost-minimization essentially means shutting down the operation of the firm.” Do you agree with the statement? Justify you answer by giving an explanation from microeconomic theory.4.What is meant by an expansion path? Illustrate expansion paths for a normal input and an inferior input.