Suppose MPL = 0.5 ∗ (q/L) and MPK = 0.5 ∗ (q/K). In the long run, the firm will hire equal amounts of capital and labor A) all of the time. B) only when w = r. C) only when w = 0.5 ∗ r. D only when w = 2 * r. E) at no point in time. .

Q: 1. A firm production function is q = KL + L, where q is output, K is hours of capital services and L…

A: Firm production refers to the process by which a company or firm transforms inputs, such as labor…

Q: According to the Law of Diminishing Returns As more units of a variable factor are used with a fixed…

A: The proportional change in output (goods or services) owing to changes in the inputs of production…

Q: i) If the wage rate is $1,000 a week, how many workers should the factory hire? (ii) If a surge in…

A: We will use the ‘Principle of marginal benefit and marginal cost here’. This simply says a firm…

Q: None

A: The production function is given by: Q = a * K^0.6 * L^0.4We know the costs for capital (K) and…

Q: . Imagine that there is an industry for a particular product where the demand for this product is…

A: (a) Long-Run Equilibrium with Fixed Number of Firms:In the long run, firms will produce where their…

Q: - Suppose that a firm uses capital (K) and labor (L) to produce some product. The prices for capital…

A: The firm cost function represents the minimum cost of producing a given amount of quantity. The cost…

Q: A firm produces chocolate according to the production function: a= K2/3,. where K is measured in…

A: Total cost is the cost that is incurred in making goods and services by converting raw material into…

Q: Which of the following is true?

A: The long-run average cost curve represents the least average cost to produce any given level of…

Q: A. Will you invest a project that requires a $ 200,000 today and returns $50,000 at the end of the…

A: Since you have asked multiple questions, we will solve the first question for you. If you want any…

Q: d. For this part, suppose that Ouroboros has two corporate customers. The first corporations' demand…

A: In part d, there are two types of customers  For costumer A, demand function DA=10,000-p      ....…

Q: b. If AC= Q?-4Q+10 i. Final the total cost and marginal cost function. Is this function is more…

A: TC = Q x AC = Q3 - 4Q2 + 10Q MC = dTC/dQ = 3Q2 - 8Q + 10

Q: a) True or False? Short-run average total cost curves have an "U the law of diminishing marginal…

A: The Law of Diminishing Marginal Returns posits that as one input is increased while others are held…

Q: 3. A firm has three factories each producing the same item. Let x, y, and z denote the respective…

A: The mathematical link between the expense spent during production of a good and the quantity of that…

Q: OR (b) Define (i) Marginal cost and (ii) Marginal revenue. The cost of producing x widgets is given…

A: (i) Marginal Cost Marginal Cost (MC) is the additional cost incurred by producing one more unit of a…

Q: (a) Let production be Q(L) = 100 L² - L³ and costs be C(Q) = 250L +600. Show how average costs…

A: a) Show how average costs change as Q rises.  Explain why it behaves in the way it does. You can use…

Q: 3. In the short term, a company has the following cost function and product function. C(N)= 10 000 +…

A: Since you have posted a question with multiple sub-parts, we will solve first three subparts for…

Q: (4) w = 3. firm's production function is F(K, L) = 2√/K + L. Factor prices are r = 2 and (a) Find an…

A: The marginal product of labor represents the increase in output as a result of an increase in labor…

Q: 9. For the cost function C(Q) = 100 + 20 - 302, the marginal cost of producing 2 units of output is…

A: Economics is a branch of social science that describes and analyzes the behaviors and decisions…

Q: FarFlung make computer keyboards. They use both labour, L, and materials, M, in their production of…

A: Q = LM Q = 160,000 MPL = dQ/dL = M MPM = dQ/dM = L

Q: 1.  It costs $25,000 to build 30 refrigerators. It costs $30,000 to build 40 refrigerators.…

A: Cost: It is the value of goods and services in terms of money.

Q: cies than smaller plants, there's no guaranty that they actually will. In fact, increasin. size…

A: SUMMARY OF GIVEN PARAGRAPH

Q: Given the total cost function C=Q³-50² +120+75 write out a variable cost (VC) function. Find the…

A: “Since you have posted multiple questions, we will provide the solution only to the first question…

Q: Question #3 Suppose a firm's short-run cost function is given by the following expression: C(q) = 10…

A: Given: The firm's short-run cost function is:  Cq = 10 + 14q - 6q2 + q3 To Find: Assuming this…

Q: Answer all the following seven parts. (a) Show the conditions for a Cobb-Douglas production function…

A: The term "long-run" refers to a period during which the production function is determined solely by…

Q: ) Assume that the output of a company is given by y (K, L) = K^0.5 * L^0.5, where the amount of…

A: The average variable cost is the ratio of the total cost to the total output.  Marginal variable…

Q: A firm produces TVs and ovens with a joint cost function that takes the form: C(x,y) = 3x^2 + 2y^2 +…

A: The cost minimization problem of the firm is to minimize its cost function with respect to the…

Q: 1. Which of these production functions have diminishing marginal returns to labor? A) F(K, L) = K +…

A: The marginal product of labor (MPL) is the additional output generated when one more unit of labor…

Q: 2. A firm producing hockey sticks has a production function given by q = 2Vkl The price of labor is…

A: Production function q=2(KL)1/2 W=price of labor V=price of capital q=level of output

Q: . A production process using two inputs, labor and capital is Q = 5LK where Q is output per day. MPK…

A: When the ratio of labour and capital prices equals the marginal rate of technical substitution of…

Q: Please provide steps by step answer with proper explanation with final answer..... Don't use pepar…

A: Total cost if produced separately: CS​+CT​=$14,000+$24,000=$38Compare with joint production…

Q: QUESTION 6 1/2, Suppose cost function c(w1;w2: y) = w1Zw22. The conditional demand for input 1 is:…

A: Given cost function :- C(w1,w2,y) = w11/2 w21/2 y2

Q: 9. For the cost function CiO) = 100 - 20 -302 the marginal cost of producing 2 units of outout is b.…

A: Economics is a branch of social science that describes and analyzes the behaviors and decisions…

Q: • point of diminishing returns (D) most productive point (P) economic capacity (E) Once a point is…

A: No of Workers TP 1 10 2 80 3 180 4 240 5 280 6 294 Variable Cost = 220 per day Fixed…

Q: Let a firm’s production function be f(K,L) = √2K1/2L1/2. a) Solve for the contingent demand…

A: A production function is an economic concept that describes the relationship between inputs (factors…

Q: Capital (K) Q= 100 Labor (L) The firm's optimization problem is to minimize total cost for a given…

A: Cost of production is minimized at the point of tangency of isocost and isoquant curves.

Q: You produce fountain pens. Let MC(q) represent the marginal cost for producing the qth pen.…

A: Given Information-   In the equation below,     Here, MC(q) depicts the additional cost of…

Q: d) On the graph given below, plot the following points showing the quantity and dollar amounts. •…

A: The difference in total production caused by adding one additional unit of labour is referred to as…

Q: Assume that housing output is a function of the quantities of capital (k) and land (l) employed by a…

A: * Answer  :-  Given that ,  Assume that housing output is a function of the quantities of capital…

Q: Which of the following production functions do not exhibit constant returns to scale? A. F(K, L)= AK…

A: Introduction Returns to scale refers to the how much output changes given a proportional change in…

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.