When I derive total economic functions such as total cost or total revenue, I get the marginal economic function. Explain why differentiating total economic functions gets the marginal economic functions

When I derive total economic functions such as total cost or total revenue, I get the marginal economic function. Explain why differentiating total economic functions gets the marginal economic functions

Microeconomics

13th Edition

ISBN:9781337617406

Author:Roger A. Arnold

Publisher:Roger A. Arnold

Chapter8: Production And Costs

Section: Chapter Questions

Problem 2WNG

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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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Gopher Excavators produces shovels in a small factory and sells the shovels in a competitive market. The following table shows the company's production function: Output (Number of workers) (Shovels) Labor 1 100 195 275 4 340 380 Use the blue points (circle symbol) to plot the production function for Gopher Excavators on the following graph. 40 Producion Function 340 100 130 40 LABOR (Number of workana) Calculate the marginal product of labor (MPL) of each worker, and then plot the MPL curve on the following graph using the blue points (circle symbol). Note: Remember to plot each point halfway between two integers. For example, when the number of workers increases from 0 to 1, the MPL of the first worker should be plotted with a horizontal coordinate of 0.5, the value halfway between 0 and 1. Line segments will automatically connect the points. (genoygl indino
A firm uses the inputs of Iron and labor to produce Cars. Suppose that the quantity of labor is fixed. The quantity of Iron and the number of Cars produced is given by the following table: Tons of Iron per week Number of Cars per week 0 0 10 50 20 100 30 170 40 220 50 250 60 260 70 250 80 200 What is the average product of Iron when 40 tons are used? What is the marginal product of the 60th ton Iron? Does this production function exhibit diminishing marginal returns? If so, at what quantity of Iron do they start to occur?
A firm can manufacture a product according to the production function:Q=F(K,L)=K^(3/4) L^(1/4).a.Calculate the average product of labour, AP_L, when the level of capital is fixed at 81 units and the firm uses 16 units of labour. How does the average product of labour change when the firm uses 256 units of labour? b.Find an expression for the marginal product of labour, MP_L, when the amount of capital is fixed at 81 units. Then, calculate the marginal product of labour for 16 and 81 units of labour. c.Suppose capital is fixed at 81 units. If the firm can sell its output at a price of $200 per unit and can hire labour at $50 per unit, how many units of labour should the firm hire in order to maximize profits?