MRTS = 0.16
wage rate, w =¥ 1500
Price of car = ¥ 11,00,000
MPK = 0.75
a) Rental rate of capital, r = MPK * Price of Car
r = 0.75 * 1100000
r = ¥ 8,25,000
********
b) Marginal Productivity of Labor, MPL
w = MPL * Price of Car
1500 = MPL * 1100000
MPL = 0.0014
*********
c) In order to minimize cost, the company should hire inputs in the ratio of MPL / MPK
MRTS (new) = 0.0014 / 0.75 = 0.0019
******
Che Problem 05-20 (algo) According to The Wall Street Journal, Mitsubishi Motors recently announced a major...
Problem 05-20 (algo) According to The Wall Street Journal, Mitsubishi Motors recently announced a major restructuring plan in an attempt to reverse declining global sales. Suppose that as part of the restructuring plan Mitsubishi conducts an analysis of how labor and capital are used in its production process. Prior to restructuring Mitsubishi's marginal rate of technical substitution is 0.15 (in absolute value). To hire workers, suppose that Mitsubishi must pay the competitive hourly wage of ¥1,670. In the study of...
According to The Wall Street Journal, Mitsubishi Motors recently announced a major restructuring plan in an attempt to reverse declining global sales. Suppose that as part of the restructuring plan Mitsubishi conducts an analysis of how labor and capital are used in its production process. Prior to restructuring Mitsubishi’s marginal rate of technical substitution is 0.16 (in absolute value). To hire workers, suppose that Mitsubishi must pay the competitive hourly wage of ¥1,620. In the study of its production process...
According to The Wall Street Journal, Mitsubishi Motors recently announced a major restructuring plan in an attempt to reverse declining global sales. Suppose that as part of the restructuring plan Mitsubishi conducts an analysis of how labor and capital are used in its production process. Prior to restructuring Mitsubishi’s marginal rate of technical substitution is 0.13 (in absolute value). To hire workers, suppose that Mitsubishi must pay the competitive hourly wage of ¥1,700. In the study of its production process...
According to The Wall Street Journal, Mitsubishi Motors recently announced a major restructuring plan in an attempt to reverse declining global sales. Suppose that as part of the restructuring plan Mitsubishi conducts an analysis of how labor and capital are used in its production process. Prior to restructuring Mitsubishi’s marginal rate of technical substitution is 0.16 (in absolute value). To hire workers, suppose that Mitsubishi must pay the competitive hourly wage of ¥1,620. In the study of its production process...
12.22 points eBook References According to The Wall Street Journal, Mitsubishi Motors recently announced a major restructuring plan in an attempt to reverse declining global sales. Suppose that as part of the restructuring plan Mitsubishi conducts an analysis of how labor and capital are used in its production process. Prior to restructuring Mitsubishi's marginal rate of technical substitution is 0.13 (in absolute value). To hire workers, suppose that Mitsubishi must pay the competitive hourly wage of ¥1,700. In the study...
According to The Wall Street Journal, Mitsublshi Motors recently announced a major restructuring plan In an attempt to reverse declining global sales. Suppose that as part of the restructuring plan MItsublshi conducts an analysis of how labor and capltal are used In Its production process. Prior to restructuring Mitsublshi's marginal rate of technical substitutlon Is 0.14 (In absolute value). To hire workers, suppose that MItsubishi must pay the competitive hourly wage of 1,580. In the study of Its productlon process...
Really need help figuring out this problem please solve! According to The Wall Street Journal, Mitsubishi Motors recently announced a major restructuring plan in an attempt to reverse declining global sales. Suppose that as part of the restructuring plan Mitsubishi conducts an analysis of how labor and capital are used in its production process. Prior to restructuring Mitsubishi’s marginal rate of technical substitution is 0.11 (in absolute value). To hire workers, suppose that Mitsubishi must pay the competitive hourly wage...
Problem 05-01 A firm can manufacture a product according to the production function: Q=F(K.L) = 3/4 1/4 a. Calculate the average product of labor, AP, when the level of capital is fixed at 81 units and the firm uses 16 units of labor. Instruction: Round your responses to 3 decimal places. What is the average product of labor when the firm uses 256 units of labor? b. Find an expression for the marginal product of labor, MP4, when the amount...
A firm can manufacture a product according to the production function: Q = F(K, L) = K3/4L1/4. Instruction: Enter your responses rounded to three decimal places. a. Calculate the average product of labor, APL, when the level of capital is fixed at 81 units and the firm uses 16 units of labor. ____ What is the average product of labor when the firm uses 256 units of labor? ____ Instruction: The second response is the exponent on L in the...
2. Production theory and cost theory a) You are an employer seeking to fill a vacant position on an assembly line. Are you more concerned with the average product of labour or the marginal product of labour for the last person hired? Explain. (4p) i) ii) If you observe that your average product is just beginning to decline, should you hire any more workers? What does this situation imply about the marginal product of your last worker hired? (4p) b)...