Q4. A firm's production function is given by q = 2z1 + 3z2. Given the input prices, w1 for z1 and wz for z2. a. Find the input demands z1 and z2 minimizing the cost of producing the level of output q. b. Find the cost function for producing the level q.

Q4. A firm's production function is given by q = 2z1 + 3z2. Given the input prices, w1 for z1 and wz for z2. a. Find the input demands z1 and z2 minimizing the cost of producing the level of output q. b. Find the cost function for producing the level q.

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

See similar textbooks

Related questions

Q: A firm’s marginal cost curve above the average variable cost curve is equal to the firm’s individual…

A: The marginal cost defines the cost that a producer incurs to produce an additional unit. After a…

Q: Please explain every part in details A competitive firm has the following short-run cost function:…

A: A competitive firm is an economic unit that produces goods or services and competes in the market…

Q: The production function for a price-taking firm is given by q = 2.5k0.4L0.4. What is the supply…

A: * SOLUTION :- *(8) Firstly we find the demand functions and then use them to find the supply…

Q: A profit - maximizing firm in a competitive market is currently producing 100 units of output. It…

A: In case of perfect competition there are large number of buyers and sellers. The firms sell…

Q: The demand function p=2000-3q2 and total cost C=2q2+800. Find the price that maximizes profit.

A: The profit function is given by, π(q)=p*q-C(q)=(2000-3q2)q-2q2-800=2000q-2q2-3q3-800 First order…

Q: A particular computing company finds that its weekly profit, in dollars, from the production and…

A: Marginal profit is the additional profit earned when an additional unit of output is produced.

Q: The demand and total profit function, P(x) for rooms in a hotel are given as follows. 3x = 600 - P…

A: Marginal cost is the additional cost incurred by producing an additional unit of output.

Q: Consider a firm with the following production function: f(x1,x2) = If the input prices are 2 and 4…

A: We are going to use Marginal rate of technical substitution ( MRTS) concept to answer this question.…

Q: Suppose the market 4 carat is competitive a typical farmer has a cost function of C=2q3-18q2+1,000q…

A: For a competitive firm, prices are given to it. And it produces the output where P=MC.

Q: A competitive firm's production function is f(L, M) = 8L1/2 + 8M ¹/2. The price of L is $1 and the…

A: production function gives the technological relationship between the quantities of input and output…

Q: Imagine a firm in a competitive market comes up with a new production method, which halves its…

A: Perfect competition market is the market where large numbers of sellers and buyers are exchanging…

Q: Let x denote the level of output of a firm’s production process. The cost function is given by C (x)…

A: Profits are the excess of revenue receipts over the costs incurred by the firm. To maximize profits,…

Q: If a retail clothing shop has to pay monthly rental of A$10,000 and has variable costs of A$20,000…

A: A firm faces different shut down constraint in different time periods such that in short-run or in…

Q: 2. The supply Qs = s(P, Pm) has the functional form of: Qs = -12 + 0.5P - 2Pm initially, the…

A: The term "supply" refers to the overall quantity of a certain commodity that is made available to…

Q: demand curve faced by the firm is: P = 230 - 4Q where Q = Q1 + Q2 total cost equations for the two…

A: MC (marginal cost) is the cost incurred by the firm when an additional unit of a good is produced.…

Q: QUESTION 1 Given a demand curve of P = 170 - 3Qd and supply of P = 2 + 6Qs, find the optimal level…

A: The demand curve is given as The supply curve is given as

Q: Suppose the short run market price a competitive firm faces is Birr 9 and the total cost of the firm…

A: Short-run equilibrium condition in Perfect competition is where Price = Marginal revenue = Marginal…

Q: 2. Suppose the production function of a firm is given by f (x₁, x2) : = 2x1 + 4x2. (a) Calculate the…

A: Production function shows the relationship between inputs and output. Isoquant represents the…

Q: A firm has the following demand function P=200-2Q and the average cost of AC=100/Q+3Q-20 a.…

A: Marginal expenses and marginal revenue are important for making the best production decisions. The…

Q: Consider a perfectly newspaper market with identical firms, each with the usual shaped cost curves.…

A: There are no monopolies in a free market paradigm. According to the theory of perfect competition,…

Q: A price-taking firm's variable cost function is VC = 20', where Qis its output per week. It has a…

A: Fixed cost of a firm is defined as the cost of a firm that does not change with change in the…

Q: The market for paperback detective novels is perfectly competitive. Market Demand is given by…

A: Given: Regular reader demand = 38 - 0.5Q Occasional reader demand Qd = 99 - 6P

Q: The market for paperback detective novels is perfectly competitive. Market Supply is given by…

A: Given Market supply function: P=5+3Q ... (1) The marginal cost of the last unit sold is…

Q: Suppose that, at a quantity of q = 20, a firm's costs are as follows: MC = 20, AVC = 12, ATC = 30.…

A: In economics AVC is basically determined as the total firms variable costs which is merely divided…

Q: Q#1: The demand function of a good is given by P+ 2Q = 20 and total average Cost function AC=Q?- 8Q+…

A: The demand function of the firm can be used to calculate the total revenue and corresponding…

Q: Kenan's stationary shop operates in a perfectly competitive market where the price for a pen (his…

A: "A perfectly competitive market structure is the one which consists of many buyers and sellers and…

Q: Marginal cost is given by the function :- 2Q2 - 130 And the equilibrium quantity is 10 so…

A: # Marginal cost measures the degree of change taking place in total cost of the firm.

Q: Suppose a firm faces the following cost function: C(q) = 36 + 16q – 8g² + 2q° -

A: Given cost function:C(q)=36+16q-8q2+2q3

Q: A commodity has a demand function modeled by p= 100-0.5x and the total cost function is C= 50x+37.5…

A: Answer: Introduction: Condition for maximum profit: Profit is maximum where marginal revenue is…

Q: 2. Suppose the production function of a firm is given by f (x1, x2) = 2x1 + 4x2. (a) Calculate the…

A: Economics refers to the social science that studies the production, distribution, and consumption of…

Q: A price-taking firm's variable cost function is vC = 20°, where Qis its output per week. It has a…

A: In the short term, the firm can't avoid its fixed cost, and so it should treat it as a sunk cost.…

Q: You sell items. Your marginal revenue and marginal cost are given by the formulas: MR (q)=…

A: The firm would involve the cost of the production of the goods and services to produce goods and…

Q: In a competitive market, the current equilibrium price is $110 per unit. A firm that produces Q…

A: Given: Price(P)=$110 per unit

Q: Suppose that each firm in a competitive market has the following cost structure: TC=100+q². MC=2q…

Q: The market for paperback detective novels is perfectly competitive. Market Demand is given by…

Q: We expect the marginal cost to increase as this firm produces more computers. But when the firm…

A: The rise or fall in the cost of producing/providing one more product is referred to as marginal…

Q: With identical firms, constant input prices, and all the other characteristics of a competitive…

A: A shift in demand is the change the determinant of demand other than the prices. It is the situation…

Q: Suppose firm A’s total cost function is given by c(q) = 3q^2 + 95. If the equilibrium price is $24,…

A: The firms and businesses tend to operate in the market with the motive of earning high amount of…

Q: 1) In a market there are 100 identical firms, where each firm has the supply function qs(P) = p/10.…

A: We’ll answer the first question since the exact one wasn’t specified. Please submit a new question…

Q: A firm has the following demand function P=200-2Q and the average cost of AC=100/Q+3Q-20 a. Find…

A: Our goal is to determine the profit-maximizing production level, calculate the associated profit,…

Q: Assume that the total cost (fixed costs and variable costs) of producing 15,000 units of a good…

A: The cost plus mark-up is the difference between actual price of product and the cost of production.…

Q: Carl is an apple farmer. Assume there is price taking in the market for apples. SRS is the short-run…

A: A firm is a price taker and can sell any quantity of the commodity at the market determined price…

Q: The demand function for a good is given by the equation P= 50 – 2Q, while total cost is given by…

A: TR = P x Q = 50Q - 2Q2

Q: 8. A firm's total cost function is given by TC = 3Q; + 2Q,Q + 7Q: Where Q, and Q. denotethe number…

A: TC = 3Q12 + 2Q1Q2 + 7Q22Q1+Q2 = 40

Concept explainers

Short-Run Costs and Long-Run Costs

Cost of short-run and the long-run is an economic term that describes the cost involved in the production of goods in a firm in the short as well as long period.

Question

Q4. A firm's production function is given by q = 2z1 + 3z2. Given the
input prices, wi for 21 and w2 for z2.
a. Find the input demands z1 and z2 minimizing the cost of producing
the level of output q.
b. Find the cost function for producing the level q.
%3D

Expert Solution

This question has been solved!

Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.

SEE SOLUTION Check out a sample Q&A here

Given

VIEW

Part A

VIEW

Part B

VIEW

Step by step

Solved in 3 steps with 3 images

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, economics and related others by exploring similar questions and additional content below.

Similar questions

suppose that input prices are (w, r) >> 0 as before, and p > 0 is the price of the output good Y. (a) Formulate the firm's profit maximization problem.
Consider that a company has a total cost function TC = 3Q3+2Q2+6. a.What is the average and marginal cost function and what are their values ifQ = 8?b. If the (inverse) demand function facing the firm is P = 6 - 2Q, what value must the slope of the isobenefit curve take for the firm to maximize its profit? Indicate the generic condition as well.
1
The cost function of competitive firm is TC = 20 + 5Q2. The product's market price is 30 AZN. Please find the firm's profit.
COURSE: ECONOMY A company has a total cost function TC = 80+3q+2q2 and a marginal cost function MC = 3+4q. If market price is P = $30 and it is producing 10 units:(a) Is firm maximizing its profits?b) What quantity should it produce in long run? Hint: MC= ATCc) Construct a table with all costs.d) Plot profit maximization points in short and long run.
Suppose a firm engaged in the illegal copying of DVD’s has a daily short run total cost function given by: STC = (q^2)+25 If pirated DVD’s sell for $20, how many will the firm copy each day? What will its profits be? What is the firm’s short run producer surplus at P=20? Develop a general expression for this firm’s producer surplus as a function of the price of pirated DVD’s.
Consider with the cost function producing a single good with the cost function {. 5, If A = 0 C(A) = %3D 10 + 10A, if A > 0 a) the Firm's Sunk Cost and Fixed Cost. b) Find the elasticity of substitution if Function is given as F(x,y) = CX y")
1. A company has the following average income (demand) curve: P=100-0.01Q. Where Q is weekly production and P is price, measured in cents per unit. The company's cost function is given by CT = 50Q + 30,000. Suppose the firm maximizes its profits.a) What is the level of production, the price and the total profit per week?b) The government decides to impose a tax of 10 cents per unit on this product. What would the level of output, price, and profit be as a result of this? CT(Total cost)
The graph shows the Cost curves for a profit maximizing firm in a competitive market. If the market price is $30 and the firm produces at the profit maximum quantity, what is the amount of the total fix cost
7. Assume that the marginal cost curve is given by mc(q) = 100 + 2q. (a) If the price is $160, what is the optimal production for the firm? What if the price is $120? (ignore the shut-down decision for this part) (b) Assuming that the market is cleared at $160 (no shortage/surplus). If the market demand is equal to 10,000 units of the product. How many firms are currently operating (n) in the market? (Hint: if the market clears qª = n x q°) (c) If the total cost curve is TC 256 + 100g + q², what's the average total cost curve? %3| what's the break-even price? (d) If the demand curve is given by qd = 8, 452 – p, what's the long-run equilibrium price, the equilibrium quantity and the long-run total number of firms (n) in the industry?
Assume coffee machine and labor are the only two inputs for a coffee shop. The labor demand elasticity will be larger if A. Coffee machine is the substitute for labor in the shop. in the short run. B. Coffee has a relative inelastic demand C. Labor cost is around 80% in the total cost of the shop. D. The supply of tea machine is quite elastic.
The table shows cost data for a firm that is selling in a perfectly competitive market. This firm's minimum average variable cost is $14 and has fixed costs equal to $100. Output 5 7 9 11 11 units 9 units Refer to the above cost table. If the price of the product is $26, the firm will produce Select TWO answers from the choices below; one selection is the number of units produced and the second selection is the dollar amount of the loss earned by the firm. ✔$100 $30 $28 $0 7 units 00 units 5 units ATC $34.00 30.00 30.55 33.09 $182 MC $13 26 35 48 for a loss.