SuperFashion produces specialty tops stitching two silk sleeves (S) to a knitted body (B). Stitching always takes 20 minutes of a seamstress time (LSilk sleeves can be produced using Labor (Ls) and silk fabric (F) according to the production function S = Ls1/3F2/3. Knitted bodies can beproduced using labor (LB) and yarn (Y) according to the production function B = LB¹/4Y1/4, L is measured in hours.SuperFashion wishes to produce 10 specialty tops.1. How many silk sleeves and how many knitted bodies does SuperFashion need to produce? Does this number depend on the cost of labor, silkfabric or yarn?

Super Fashion is a company that specializes in the production of unique tops that are made by…

SuperFashion produces specialty tops stitching two silk sleeves (S) to a knitted body (B). Stitching always takes 20 minutes of a seamstress time (L Silk sleeves can be produced using Labor (Ls) and silk fabric (F) according to the production function S = Ls¹/3F2/3, Knitted bodies can be produced using labor (La) and yarn (Y) according to the production function B=Lg¹/4Y1/4, L is measured in hours. SuperFashion wishes to produce 10 specialty tops. 1. How many silk sleeves and how many knitted bodies does SuperFashion need to produce? Does this number depend on the cost of labor, silk fabric or yarn?

SuperFashion produces specialty tops stitching two silk sleeves (S) to a knitted body (B). Stitching always takes 20 minutes of a seamstress time (L Silk sleeves can be produced using Labor (Ls) and silk fabric (F) according to the production function S = Ls¹/3F2/3, Knitted bodies can be produced using labor (La) and yarn (Y) according to the production function B=Lg¹/4Y1/4, L is measured in hours. SuperFashion wishes to produce 10 specialty tops. 1. How many silk sleeves and how many knitted bodies does SuperFashion need to produce? Does this number depend on the cost of labor, silk fabric or yarn?

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

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.

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SuperFashion produces specialty tops stitching two silk sleeves (S) to a knitted body (B). Stitching always takes 20 minutes of a seamstress time (L
Silk sleeves can be produced using Labor (Ls) and silk fabric (F) according to the production function S = Ls1/3F2/3. Knitted bodies can be
produced using labor (LB) and yarn (Y) according to the production function B = LB¹/4Y1/4, L is measured in hours.
SuperFashion wishes to produce 10 specialty tops.
1. How many silk sleeves and how many knitted bodies does SuperFashion need to produce? Does this number depend on the cost of labor, silk
fabric or yarn?

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SuperFashion produces specialty tops stitching two silk sleeves (S) to a knitted body (B). Stitching always takes 20 minutes of a seamstress time (LT).
-
Silk sleeves can be produced using Labor (Ls) and silk fabric (F) according to the production function S Ls1/3F2/3. Knitted bodies can be
produced using labor (LB) and yarn (Y) according to the production function B = LB¹/4Y¹/4. L is measured in hours.
SuperFashion wishes to produce 10 specialty tops.
1. How many silk sleeves and how many knitted bodies does SuperFashion need to produce? Does this number depend on the cost of labor, silk
fabric or yarn?
Suppose that silk fabric costs $20 while the labor services needed to produce silk sleeves cost $10 an hour.
2. How many yards of fabric and how many hours of labor are needed to produce 20 sleeves as cheaply as possible? What is the cost of producing
the sleeves?
Suppose that yarn costs $15 while the labor services needed to knit a body cost $15 an hour.
3. How many hours of labor are needed to produce 10 bodies as cheaply as possible? What is the cost of producing the knitted bodies?
Last, suppose that seamstresses are paid $20 an hour.
4. What is the total cost of producing 10 specialty tops? What is the per unit cost?
5. Suppose SuperFashion wanted to raise production to 20 specialty tops. Would the per unit cost of a top remain the same? Would it increase?
Would it decline? Justify your answer.

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