Suppose prices of labor and capital are $4 and $5 respectively. And 30 units ofproduct A can be produced by employing just labor and capital in the four differentways of technique.Production Techniques:IIIIIIIVLabor324Сapital132Refer to the above table. Which technique is economically most efficient inproducing A?O a) I.b) II.O c) III.O d) IV.

Cost is the expenditure that is occurred in producing goods and services in an economy. It is used…

Answered: Suppose prices of labor and capital are…

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Which of the following production functions exhibits increasing returns to scale? OA. AY=k1/2 1/2 O B. Y=K°L1-a O.Y=k1/3L 2/3 O D. Y=K1/2L 3/4 O E. Y=K1/3L 1/3
In the Cost Minimization Problem, the isoquant curve for an output level equal to the output quota? Illustrates the cost of labor and capital a firm pays to produce a level of output in excess of an output quota. Illustrates all combinations of labor and capital that a firm cannot afford. Illustrates all combinations of labor and capital that a firm can afford. O Illustrates all combinations of labor and capital that a firm can use to produce a level of output equal to the output quota.
What is a diseconomy of scale and what is an economy of scale? What modifications would you make to your current home gardening production if you intended to achieve economies of scale? Clarify why
A firm's production function takes the form: Q(L, K) = min{2L, 3K}, where Q represents output and L and K represent labour and capital, respectively and where w and r give the prices of labour and capital. Assuming no other costs, what would be the marginal cost if the firm increased output by 1 unit? O O MC = Q [ 12/2₁ = Q ( + 1/2 + 1/2 ) MC = W 3r 3w+2r 3w+2r + O MC=3w+2r O W r = 21/1/2+1/1/3/2 O MC =2w+3r MC=1/2
Give me both answer with full explanation
Assume that a firm uses just two factors of production. The table given below shows what happens to output as the firm increases one or both of these inputs. The effects of increasing the amounts of both inputs Situation (i) Situation (ii) Input Input 2 Output Input 1 Input 2 Output 1 1 12 1 14 2 2 24 2 2 24 3 3 36 3 2 32 4 4 48 4 2 38 5 60 2 42 Which situation represents the long run?
QUESTION 39 The folllowing table shows data for a simple production function. Capital (K). Labor (L) 10 0 10 1 10 2 3 4 5 6 10 10 10 10 TP or Q AP MP 6 14 20 14 8 Assume that the cost of capital, PK, is $50 per unit, and the cost of labor, PL, is $100 per unit. Marginal cost, MC, is at minimum when labor, L, is equal to O2 units. O4 units. O 3 units. 5 units.
Let's assume that a firm produces 60 products. Its total weekly cost (TC) at this output is $2,100. This includes TVC and TFC. We also know that the firm employs 3 part- time workers at a wage cost of $600 per worker per week. This is the firm's only variable cost (TVC). What is the firm's average fixed cost (AFC) at this output? O $2.50. O $2. O $5. O $100. O $10. Let's assume that a firm's total weekly costs are as follows: 1. Salaries of hired workers $5,000. 2. Supplies = $1,000. 3. Rent = $600, 4. The owners have invested a certain amount of their own money into the business. This could have earned them interest of $200 per week if they had chosen to put it into a bank instead of investing it into their business. 5. The value of the owner's time is estimated to be $800 per week. What are the firm's total economic costs? O $6.000 O $7.600. O $900. $7.500. O $6.700.
1. Assume a daily production function for a firm is Q= min(3L, 4K) a, If L = 100 and K = 100 what quantity is produced? Explain why. b. What would be the cost-minimizing labor and capital combination for this firm to produce Q = 1200? (show your work) Labor = Capital = At this level of production from part b (Q-1200), if the wage rate is: w- $30 and the rental rate of capital is: r= $100, what is the total cost of production? (show your calculations) C.
The production function for good X in the table below exhibits increasing marginal returns to capital over what outout range? Production Function for Good X Choose Multiple Choice: Between o and 1,524 Between 2391 and 3,048 Between o and 2,991 • Between 3,016 and 2,945 L* MPx= (AQ/AK) AP=(Q/K) Marginal Product of Average Product of Labor Capital Output Capital Capital 10 57 5.7 5.70 20 324 26.7 16.20 30 657 33.3 40 1,072 41.5 26.80 50 1,524 45.2 30.48 60 1,976 45.2 32.93 70 2,391 41.5 34.16 2,724 33.3 34.85 9e 2,991 A 33.23 10e 3,048 5.7 30.48 11e 3,016 -3.2 27.42 120 2,945 -7.1 24.54
When a firm produces one unit, the variable cost is $7. When the firm produces two units, the variable cost is $10. When the firm produces three units, the variable cost is $12. What is the marginal cost associated with three units of production? Select one: O a. 3 O b. 7 O c. 2 O d. 0
A firm's production function is Q = 100L.0 K-4. The firm's input prices are PL = $40 and PK = $30. The firm wishes to produce Q = 3,000 units of output and minimize the cost of production. How much labor (L) should the firm employ? O A. L=20.96. O B. L=31.45. O C. L=34.26. O D. L=38.45. O E. L=41.22. QUESTION 2 A firm estimates its production function as Q = -2.4 + 20*L -.5*L2 + 30*K -1.00*K2 + 15*F -.3*F2. Total cost is TC = $2*L + $2.5*K + $1.75*F. The firm wishes to produce 400 units of output. Use Excel to find the cost minimizing amounts of L, K and F. How much F (Fuel) should the firm use? O A. F=7.90. O B. F=9.58. O C. F=10.75. O D. F=12.63. O E. F=14.88.

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