Homer's Donut Shoppe has the production function q=10L +20LO A. AP=10 + 40L-15L²B. AP=10LC. AP=10+20LD.L²- 5L³. The average product of labor isAP = 10 + 20L - 5L²

Homer's Donut Shoppe has the following production function. q =10L + 20L2 - 5L3where q is output, L…

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Homer's Donut Shoppe has the production function q=10L +20L - 5L³. The average product of labor is

ENGR.ECONOMIC ANALYSIS

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ISBN:9780190931919

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Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Concept explainers

Isocost and Isoprofit Curve Analysis

An isocost curve in the production theory that is a crucial part of economics depicts different combinations of factor inputs at a given market cost. In other words, this shows all the combinations of production factors that cost the same for the firm to employ. Usually, this can be depicted as a downward sloping straight line when the firms act as the price-takers in the factor markets. The slope of this mainly depicts the relative prices of different production factors.

Question

Homer's Donut Shoppe has the production function q=10L +20L
O A. AP=10 + 40L-15L²
B. AP=10L
C. AP=10+20L
D.
L²- 5L³. The average product of labor is
AP = 10 + 20L - 5L²

Expert Solution

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Homer's Donut Shoppe has the following production function.

q =10L + 20L² - 5L³

where q is output, L is labor.

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