in the Firm 8. Understanding the properties of isoquants An isoquant is a curve showing all combinations of labor and capital that can produce the same quantity of output. This question will help you ols understand various properties of isoquants. ed メ々 LABOR Use the information provided on the previous graph to identify if each statement is True or False. Statement True False The marginal rate of technical substitution is larger in absolute value at point G than at point B The quantity of output produced at point D must be greater than that at point C. Each combination of inputs at points H and C produces the same quantity of output. CAPITAL

in the Firm 8. Understanding the properties of isoquants An isoquant is a curve showing all combinations of labor and capital that can produce the same quantity of output. This question will help you ols understand various properties of isoquants. ed メ々 LABOR Use the information provided on the previous graph to identify if each statement is True or False. Statement True False The marginal rate of technical substitution is larger in absolute value at point G than at point B The quantity of output produced at point D must be greater than that at point C. Each combination of inputs at points H and C produces the same quantity of output. CAPITAL

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Barb's Bakery employs three workers who produce 6 cakes per hour. After Barb hires a fourth worker, production increases to 12 cake per hour. Which of the following statements is TRUE? a. b. C. d. Because the marginal product of the fourth worker is greater than the average product of three workers, the average product must rise. Because the marginal product of the fourth worker is less than the average product of three workers, the average product must fall Because the marginal product of the fourth worker is less than the average product of three workers, the average product must rise. Because the marginal product of the fourth worker is greater than the average product of three workers, the average product must fall.
7 The Paunch Burger restaurant chain currently produces 250,000 units of output by using 2,400 units of capital and 520 units of labor. Paunch Burger’s marginal rate of technical substitution (MRTS) of labor for capital is 3.5. If Paunch Burger’s regional manager wants to produce the same amount of output but increase the company’s use of capital by 175 units, how many units of capital will Paunch Burger now need to use?
Question 10 Figure 1 below shows the relationship between the number of mechanics hired and the number of car repairs performed per day at a car-repair shop. Number of Cars Repaired 0 2 4 5 Number of Mechanics The production process depicted on the graph exhibits marginal product of labor. O increasing O constant O diminishing 18 17 15 12 8 00
The figure shows the total product curve for different levels of a variable input, labor. Output Total Product curve АВ с D E Quantity of Labor In the figure, at point C O average product equals marginal product O marginal product is at a maximum total product is increasing at an increasing rate average product is declining but positive
Macmillan Learning Consider the table, which reports production information for a firm that uses a fixed amount of capital and varying amounts of labor. Use this information to answer the questions. Do not round answers. What is the marginal product of the third worker? Third worker's marginal product: units What is the average product of the second worker? Round your answer to the nearest whole number. Second worker's average product: units What are diminishing marginal returns, and with which worker do they set in for this firm? Diminishing marginal returns occur in the short run when variable inputs are added to a fixed input, and marginal product declines. In this case, diminishing returns set in with the fourth worker. O Diminishing marginal returns occur in the short run when variable inputs are added to a fixed input, and product declines. In this case diminishing Workers 1 2 3 4 Output (total product) 23 27 33 37
Consider the following production function: q = 9LK + 6L² – Assuming capital is measured on the vertical axis and labor is measured on the horizontal axis, determine the value of the marginal rate of technical substitution when K= 30 and L= 10. MRTS = -. (Enter a numeric response using a real number rounded to two decimal places.) 20 tv MacBook Air F6 FB 10 F3 23 2$ & з 4 6 7 8 { [ E Y U P D F G J K > C V N M command option - .. .- B
Consider the following production function that depends only on labor:Q = 4L + 12L² - 6L³ 1. Compute the APL (average product of labor). 2. Compute the MPL (marginal product of labor). 3. What is the value of L* at which APL is the highest? 4. For L > L*, which one is bigger, APL or MPL? How about when L < L* and L = L*? 5. Draw APL and MPL on the y-axis as a function of L on the x-axis. Label the point of the intersection of APL and MPL.
23) The marginal products of the first, second, and third workers are 50, 34, and 22, respectively. If four workers can produce 116 units of output, then the marginal product of the fourth worker is A) 10 B) 12 D) 116 Answer: A Diff: 2 Topic: The Production Process Skill: Analytic C) 22
/SMHS Quia - Physical Sc... 0 Multiple Choice New Tab O MC If labor is the only variable input, the marginal product of labor is at a minimum at point b. minimum at point a ATC maximum at point a AVC Lecture Videos -... < Prev Saved 27 of 35 ⠀⠀
3. Theo employs labor at a competitive wage (W) of $3 per unit, and he employs capitalat a competitive rental rate (R) of $6 per unit.a. State the cost-minimizing rule. You must provide both a written statement of it, and state it as anequation.b. At Theo’s current combination of labor and capital, the marginal product of labor (MPL) is twiceas large as the marginal product of capital (MPK). Is Theo currently employing the optimal ratio oflabor and capital? If not, how should he adjust his hiring of labor and/or capital? Explain.
20- The firm's marginal rate of technical substitution is diminishing. 19- 18- A firm finds that it can always trade five units of labor for one unit of capital and still keep output 17- 16- 15- constant. 14- Using the line drawing tool, graph an isoquant curve for the firm in the middle diagram. Label this line 'Isoquant'. 13- 12- 11- Carefully follow the instructions, and only draw the required objects. 10- 9- 8- 7- 6- 5- 4- 3- 2- 1 0+ 2 6. 8 10 12 14 16 18 20 Labor Capital