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Homework 9 Use the space below and the back to write out and clearly indicate your...
Print this page out and use the space below and the back to write out and...
Print this page out and use the space below and the back to write out and clearly indicate your answers. Do not use this sheet as scrap paper, but use it to neatly present your work. Suppose a firm produces output y from input x according to the production function y = 4x1/3. 1) For general output price p and factor price w, write down the firm's profit function for profit II in terms of input x. Find the optimal...
2) Eor each of the production functions below, find the cost function and conditional factor demands...
2) Eor each of the production functions below, find the cost function and conditional factor demands if w1-2 and w2-4. What is the amount of x1 and x2 that minimizes the cost of producing 4 units of output? a. f(x)- XiX22 b. fx)- 2xi+x2 c. f(x)-min(x,2x2) d. u(x)- max(xi,X2)
5. Let the firm's production function be given by y = x1 + x2. Note that the inputs 21 and 2 are perfect substitu...
5. Let the firm's production function be given by y = x1 + x2. Note that the inputs 21 and 2 are perfect substitutes in this production process. Suppose w = 2 and w2 = 1. (a) Derive the conditional factor/input demands and use them to find the long-run cost function for this firm. (b) For these factor prices, derive the firm's long-run supply curve. (c) For these factor prices graph the firm's long-run supply curve. (d) Suppose the price...
3. Consider the linear production function y = axı + B.x2 where xı and X2 are...
3. Consider the linear production function y = axı + B.x2 where xı and X2 are inputs with prices wi and W2 respectively. (a) Derive the conditional factor demands for rı and 22. (b) Derive the cost function. (c) Derive the short-run cost function when input 2 is fixed at 72. (d) Derive both short- and long-run average cost functions.
Question 1: Cost Minimization and Cost Curves Suppose that Jennifer produces good y by using input...
Question 1: Cost Minimization and Cost Curves Suppose that Jennifer produces good y by using input xi and x2. The production function which Jennifer faces is: y = x} + x] The cost for every unit of xi is wi and the cost for every unit of x2 is w2. There is a fixed cost component F, which also forms a part of her total cost. (a) Write down the cost minimization problem. Solve this problem and express x1/x2 as...
1) Foreach of the production functions below, draw the isoquant passing througb the point z^(4,1). Label...
1) Foreach of the production functions below, draw the isoquant passing througb the point z^(4,1). Label at least two points on the isoquant. Also determine whether the technology exhibits CRS,IRS or DRS. a. f(x)- 2x2 b. f(x)-x1/2+X2 c. f(x)- max(xiX2) d. f(x)-xiX22 2) Eoreach of the production functions below, find the cost function and conditional factor demands if w1-2 and w2-4. What is the amount of x1 and x2 that minimizes the cost of producing 4 units of output? a....
5. Let the firm's production function be given by y 1+2. Note that the inputs r1...
5. Let the firm's production function be given by y 1+2. Note that the inputs r1 and 2 are perfect substitutes in this production process. Suppose wi 2 and w2 1 (a) Derive the conditional factor/input demands and use them to find the long-run cost function for this firm. (b) For these factor prices, derive the firm's long-run supply curve. (c) For these factor prices graph the firm's long-run supply curve. (d) Suppose the price of the second input, w2,...
Problem 2: A firm has the following production function: f(x1,x2) = x1 + x2 A) Does...
Problem 2: A firm has the following production function: f(x1,x2) = x1 + x2 A) Does this firm's technology exhibit constant, increasing, or decreasing returns to scale? B) Suppose the firm wants to produce exactly y units and that input 1 costs $w1 per unit and input 2 costs $w2 per unit. What are the firm's conditional input demand functions? C) Write down the formula for the firm's total cost function as a function of w1, W2, and y.
= Question 1: Cost Minimization and Cost Curves Suppose that Jennifer produces goody by using input...
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Question 1: Cost Minimization and Cost Curves Suppose that Jennifer produces goody by using input x and x2. The production function which Jennifer faces is: The cost for every unit of Xi is wi and the cost for every unit of x2 is w2. There is a fixed cost component F, which also forms a part of her total cost. (a) Write down the cost minimization problem. Solve this problem and express X1/X2 as a function of w2/wi. Microeconomics...
a profit maximizing firm has a technology with the production function f(x1,x2) =x1^0.5 x2^0.5 can only...
a profit maximizing firm has a technology with the production function f(x1,x2) =x1^0.5 x2^0.5 can only use 4 units of x2 in the short run. what is the optimal amount of x1 to use in the short run if the price of x1 is $1 and price of output is $13 .how much output does the firm make ? sketch 2 isoquants on same axis for production function f(x,y) = min (y,x^2)
Print this page out and use the space below and the back to write out and clearly indicate your answers. Do not use this sheet as scrap paper, but use it to neatly present your work. Suppose a firm produces output y from input x according to the production function y = 4x1/3. 1) For general output price p and factor price w, write down the firm's profit function for profit II in terms of input x. Find the optimal...
2) Eor each of the production functions below, find the cost function and conditional factor demands if w1-2 and w2-4. What is the amount of x1 and x2 that minimizes the cost of producing 4 units of output? a. f(x)- XiX22 b. fx)- 2xi+x2 c. f(x)-min(x,2x2) d. u(x)- max(xi,X2)
5. Let the firm's production function be given by y = x1 + x2. Note that the inputs 21 and 2 are perfect substitutes in this production process. Suppose w = 2 and w2 = 1. (a) Derive the conditional factor/input demands and use them to find the long-run cost function for this firm. (b) For these factor prices, derive the firm's long-run supply curve. (c) For these factor prices graph the firm's long-run supply curve. (d) Suppose the price...
3. Consider the linear production function y = axı + B.x2 where xı and X2 are inputs with prices wi and W2 respectively. (a) Derive the conditional factor demands for rı and 22. (b) Derive the cost function. (c) Derive the short-run cost function when input 2 is fixed at 72. (d) Derive both short- and long-run average cost functions.
Question 1: Cost Minimization and Cost Curves Suppose that Jennifer produces good y by using input xi and x2. The production function which Jennifer faces is: y = x} + x] The cost for every unit of xi is wi and the cost for every unit of x2 is w2. There is a fixed cost component F, which also forms a part of her total cost. (a) Write down the cost minimization problem. Solve this problem and express x1/x2 as...
1) Foreach of the production functions below, draw the isoquant passing througb the point z^(4,1). Label at least two points on the isoquant. Also determine whether the technology exhibits CRS,IRS or DRS. a. f(x)- 2x2 b. f(x)-x1/2+X2 c. f(x)- max(xiX2) d. f(x)-xiX22 2) Eoreach of the production functions below, find the cost function and conditional factor demands if w1-2 and w2-4. What is the amount of x1 and x2 that minimizes the cost of producing 4 units of output? a....
5. Let the firm's production function be given by y 1+2. Note that the inputs r1 and 2 are perfect substitutes in this production process. Suppose wi 2 and w2 1 (a) Derive the conditional factor/input demands and use them to find the long-run cost function for this firm. (b) For these factor prices, derive the firm's long-run supply curve. (c) For these factor prices graph the firm's long-run supply curve. (d) Suppose the price of the second input, w2,...
Problem 2: A firm has the following production function: f(x1,x2) = x1 + x2 A) Does this firm's technology exhibit constant, increasing, or decreasing returns to scale? B) Suppose the firm wants to produce exactly y units and that input 1 costs $w1 per unit and input 2 costs $w2 per unit. What are the firm's conditional input demand functions? C) Write down the formula for the firm's total cost function as a function of w1, W2, and y.
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Question 1: Cost Minimization and Cost Curves Suppose that Jennifer produces goody by using input x and x2. The production function which Jennifer faces is: The cost for every unit of Xi is wi and the cost for every unit of x2 is w2. There is a fixed cost component F, which also forms a part of her total cost. (a) Write down the cost minimization problem. Solve this problem and express X1/X2 as a function of w2/wi. Microeconomics...
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