SavedThe following table shows the production function for a bicycle manufacturer:Number of WorkersNumber of BicyclesMarginal ProductMarginal Revenue1327310$412213$1a) Suppose that the weekly wage is $700. What is the marginal labor cost of the second worker per week?$b) Suppose that the price of a bicycle is $460. What is the marginal revenue for each level of output? Instructions: Fill in the values forthe marginal revenue in the table above.c) How many workers does the bicycle manufacturer employ if the price per bicycle is $460 and the weekly wage is $700?workersd) If the price per bicycle drops to $300, what happens to the number of employed workers?The number of employed workers will (Click to select)Next>5 of 8< PrevT ee to searchASLSf12pausebreakf10f8f6f7f5f3f42&$4##3875PUYTREA2

(a)It is given that the weekly wage is $700; therefore, the marginal labor cost of the second worker…

Answered: Saved The following table shows the…

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Avg and Marginal Cost 2 Output 4 10 B 9 30 20 15 10 Total Product Curve 2 3 1 5 6 7 Labor Avg and Marginal Product Curves 1 2 3 4 5 Labor 6 7 8 MP AP TA What do the graphs above tell us about the relationship between the Total Product and the Marginal Product of Labor? At what point do diminishing returns to labor begin?
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Suppose Mr. Saad is a producer of Lola Loo chocolate, following is the information available of his production plant. Quantity of Labour (L) Quantity of 1 2 3 4 5 Capital (K) 10 15 25 100 50 20 30 40 50 75 50 75 100 125 150200250 300 75 90 105 120 2 30 50 62 15 If K and Lare imperfect substitutes and complements from the information above draw at least three isoquant (map) and identify the level of production. H73 4
3.
Item 9 The following graph shows the marginal and average product curves for labor, the firm's only variable input. The monthly wage for labor is $2,000. Fixed cost is $120,000. | APMP 100 80 60 MP AP 60 80 100 120 140 160 20 40 Labor When the firm uses 100 units of labor, what is marginal cost at this level of output? Multiple Choices $33.33 $25 = % O $180 O $90 Ave rage aid m arginal prodictof labor 20
Question 4. [Costs - Short Run vs Long Run] Following is a firm's production function for soccer balls: q=√k₂l, where k₁ is the fixed amount of k(capital equipment) in the short run, and I is the amount of labor. a)) Calculate the firm's short-run total costs as a function of q, v, w and k₁ (where v = unit capital price; w= unit labor price) b)(ints) Given q, v, and w, how should the capital stock be chosen to minimize short-run total cost? c) d) ) Using your answer from b) above, calculate the long-run total cost of soccer ball production. For v=$1, w=$4, and k₁=100, at what level of q is short-run cost function tangent to the long-run cost function?
A chair manufacturer hires its assembly-line labor for $20 an hour and calculates that the rental cost of its machinery is $10 per hour. Suppose that a chair can be produced using 4 hours of labor or machinery in any combination. If the firm is currently using 2 hours of labor for every two hours of machine time, is it minimizing its cost of production? If so, why? If not, how can it improve the situation? The firm O A. is not currently minimizing its cost of production because the ratio of the marginal product of labor to the marginal product capital is equal to the ratio of the wage rate to the rental cost. O B. is currently minimizing its cost of production because its marginal rate of technical substitution less than the ratio of input prices. C. is not currently minimizing its cost of production because the marginal product of labor divided by the wage is less than the marginal product of capital divided by the rental cost. O D. is currently minimizing its cost of production…
Webby Inc. is a web development company. Webby's monthly production function for developing websites is given in the table below. a. Fill in the marginal product column. Instructions: Enter your answers as a whole number. Programmers 0 Websites 0 Marginal Product 1 2 44 2 7 3 15 4 20 5 24 6 26 es b. Marginal product diminishes after the (Click to select) programmer.
3. The Chipper Cookie Company's output is given by the Cobb-Douglas Production function P = 120L0.7 K0.3, where P is the number of units produced when Lis the amount spent on labor and K is the amount spent on capital. a. What is the production if L = 600 and K = 600? b. Find the marginal productivities. c. Evaluate the marginal productivities with L= 600 and K = 600. d. Interpret the meanings of the marginal productivities found in part c. e. If their budget is $1200 then there is a constraint L+ K = 1200. Use Lagrange multipliers (^) to find the values of L and K that will maximize production and find the maximum production f. Find and interpret 2 for this problem. only need part e and f!
5 Question 5 A bottling company uses two inputs to produce bottles of the soft drink Dr Pibb; bottling machines, K, and workers, L. The firm's production function exhibits diminishing MRTS. At its current level of production, the firm spends 800 per day on machinery and 200 per day paying wages to its workers. At this level of production, the marginal product of the machine is an additional 200 bottles per day and the marginal product of labor is 50 more bottles per day. Is this firm producing at minimum cost? If it is minimizing cost, explain why. If it is not minimizing cost, explain how the firm can lower its cost.
1. What should the firm do if the marginal product obtained from the last dollar spent on capital is smaller than the marginal product derived from the last dollar spent on labor and why? Graphically illustrate.

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