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4. Because of a potential ban on imports of such machines from China, the cost of...
Batteries are one of the major imports of the US from China. Batteries cost 10 Yuan...
Batteries are one of the major imports of the US from China. Batteries cost 10 Yuan in China. a) If the exchange rate is 7 Yuan/$, how much does the battery cost in the US? b) If the Dollar appreciates to 8 Yuan/$, how much does the battery cost in the US now? Assume that the price of the battery does not change. c) What happens to the import of batteries from China? What happens to the NX of the...
4. Production of bikes requires 3 workers for every 2 machines, such that bikes are prodaced...
4. Production of bikes requires 3 workers for every 2 machines, such that bikes are prodaced according to F(K.L) min(3K, 2L) (a) Setup the short run cost minimization problem when R-6. (2 points) 5 (b) Solve for the short run optimal amount of labor Lsle) and short run minimized cost Csa(w,r.q). (3 points) (e) Now suppose the bike shop can freely choose capita! (K) and labor (L). Setup the long run cost minimiza- tion problem. (2 points) (d) Solve for...
just answer e,f,g,h,i,j. (a) (3 points) To begin, assume that a firm is producing using q...
just answer e,f,g,h,i,j.
(a) (3 points) To begin, assume that a firm is producing using q = h(K, L) = K(1/3) L (1/3). Suppose the firm currently owns 128 machines, the price of the good is P = $96, the rental rate of capital is r = $4, and the wage rate is w = $16. What level of Labour would be hired? How much would be produced? Would the firm make a profit or a loss? Suppose there are...
Question 2: Consider a ski resort which uses capital K (mountains, ski lifts, lodges, etc.) and...
Question 2: Consider a ski resort which uses capital K (mountains, ski lifts, lodges, etc.) and labor L (ski instructors, rental shop employees, kitchen staff, etc.) to accomodate q skiers per day according to the production function q= f(L,K) = (Kº + LP) where 0 <p<1. (1) Given the ski resort wants to accomodate q skiers at the minimum possible cost, solve for L*(q) and K*(q) in terms of wages w, price of capital r, and the number p. (2)...
1. Suppose cars are produced using workers and machines as perfect complements. The production func- tion...
1. Suppose cars are produced using workers and machines as perfect complements. The production func- tion for producing cars is: F(K, L) = min(2K,5L) (a) Setup the short run cost minimization problem when K = 10. (2 points) (b) Solve for the short run optimal amount of labor Lsr() and short run minimized cost Csr(w,r,q). Circle your answer. (4 points) (c) Now suppose the car factory can freely choose capital (K) and labor (L). Setup the long run cost minimization...
Lulu currently hires 4 workers and rents 9 machines to produce 12 leggings. Is Lulu minimizing...
Lulu currently hires 4 workers and rents 9 machines to produce
12 leggings. Is Lulu minimizing her costs? How do you know?
Lulu owns a firm that produces leggings. The production function is given by Q = 2VKVL, so that MPL VK VI and MPk = VL Q is Lulu's VK output, K is capital, L is labor, and MP is the marginal product. The wage (w)rate per worker (L) is $40 per day and rental rate (r) per unit...
China BAU Restrict BAU Restrict China Restrict BAU ealra impontaust WQ3. EXERCISE 4.14 NASH EQUILIBRIA AND...
China BAU Restrict BAU Restrict China Restrict BAU ealra impontaust WQ3. EXERCISE 4.14 NASH EQUILIBRIA AND CLIMATE CHANGE Think of the problem of climate change as a coordination game between two countries called China and the US. Each country has two possible strategies for addressing global carbon emissions:Restrict (taking measures to reduce emissions, for example by taxing the use of fossil fuels) andBAU (the Stern report's 'business as usual' scenario). Figure 4.17 describes the outcomes (renamed Fig.3a) and hypotheticapayoffs (Figs....
2. To produce 18 units of output a firm can hire either 9 workers or 3...
2. To produce 18 units of output a firm can hire either 9 workers or 3 machines. a. Let L denote workers and K denote machines. Write down a production function that represents this firm's production technology. (2 points) b. Let w denote the wage rate and r denote the rental rate of capital. Suppose wir = 0.4. Derive the firm's long run factor demand functions for labor and capital and the firm's long run cost function. (4 points) C....
4. A company produces economic analysis reports using hours of labor (L) and computers (K). The...
4. A company produces economic analysis reports using hours of labor (L) and computers (K). The production function is ? = 2?√? Initially, in the short run, they have just 1 computer (K = 1). The wage is $20 per hour, and the cost of capital is $10. a. Derive short run total cost and short run average costs curves, with costs as a function of q. Do these costs curves exhibit economies or diseconomies of scale? Explain. (5) b....
How might ABC create an efficient and cost-effective supply chain in getting Jeans from China to...
How might ABC create an efficient and cost-effective supply
chain in getting Jeans from China to Europe? What type of
organization might help ABC in the shipping process and what
function could they perform? Cite advantages and disadvantages of
shipping directly from China or shipping through New York? Which
would you choose and why?
Case - ABC Jean Company (ABC) is a US firm that sells custom designed blue jeans. A key selling attribute is that the ABC jeans fit...
4. Production of bikes requires 3 workers for every 2 machines, such that bikes are prodaced according to F(K.L) min(3K, 2L) (a) Setup the short run cost minimization problem when R-6. (2 points) 5 (b) Solve for the short run optimal amount of labor Lsle) and short run minimized cost Csa(w,r.q). (3 points) (e) Now suppose the bike shop can freely choose capita! (K) and labor (L). Setup the long run cost minimiza- tion problem. (2 points) (d) Solve for...
just answer e,f,g,h,i,j.
(a) (3 points) To begin, assume that a firm is producing using q = h(K, L) = K(1/3) L (1/3). Suppose the firm currently owns 128 machines, the price of the good is P = $96, the rental rate of capital is r = $4, and the wage rate is w = $16. What level of Labour would be hired? How much would be produced? Would the firm make a profit or a loss? Suppose there are...
Question 2: Consider a ski resort which uses capital K (mountains, ski lifts, lodges, etc.) and labor L (ski instructors, rental shop employees, kitchen staff, etc.) to accomodate q skiers per day according to the production function q= f(L,K) = (Kº + LP) where 0 <p<1. (1) Given the ski resort wants to accomodate q skiers at the minimum possible cost, solve for L*(q) and K*(q) in terms of wages w, price of capital r, and the number p. (2)...
1. Suppose cars are produced using workers and machines as perfect complements. The production func- tion for producing cars is: F(K, L) = min(2K,5L) (a) Setup the short run cost minimization problem when K = 10. (2 points) (b) Solve for the short run optimal amount of labor Lsr() and short run minimized cost Csr(w,r,q). Circle your answer. (4 points) (c) Now suppose the car factory can freely choose capital (K) and labor (L). Setup the long run cost minimization...
Lulu currently hires 4 workers and rents 9 machines to produce
12 leggings. Is Lulu minimizing her costs? How do you know?
Lulu owns a firm that produces leggings. The production function is given by Q = 2VKVL, so that MPL VK VI and MPk = VL Q is Lulu's VK output, K is capital, L is labor, and MP is the marginal product. The wage (w)rate per worker (L) is $40 per day and rental rate (r) per unit...
China BAU Restrict BAU Restrict China Restrict BAU ealra impontaust WQ3. EXERCISE 4.14 NASH EQUILIBRIA AND CLIMATE CHANGE Think of the problem of climate change as a coordination game between two countries called China and the US. Each country has two possible strategies for addressing global carbon emissions:Restrict (taking measures to reduce emissions, for example by taxing the use of fossil fuels) andBAU (the Stern report's 'business as usual' scenario). Figure 4.17 describes the outcomes (renamed Fig.3a) and hypotheticapayoffs (Figs....
2. To produce 18 units of output a firm can hire either 9 workers or 3 machines. a. Let L denote workers and K denote machines. Write down a production function that represents this firm's production technology. (2 points) b. Let w denote the wage rate and r denote the rental rate of capital. Suppose wir = 0.4. Derive the firm's long run factor demand functions for labor and capital and the firm's long run cost function. (4 points) C....
How might ABC create an efficient and cost-effective supply
chain in getting Jeans from China to Europe? What type of
organization might help ABC in the shipping process and what
function could they perform? Cite advantages and disadvantages of
shipping directly from China or shipping through New York? Which
would you choose and why?
Case - ABC Jean Company (ABC) is a US firm that sells custom designed blue jeans. A key selling attribute is that the ABC jeans fit...
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