Homework Answers
Total cost = Variable cost + Fixed cost .
Fixed cost will not vary with output . So it will not be a function of Q .
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Given the production function: Q-4(KL)12, w = 16, r-25, and capital is fixed at level Ko....
Name 4. For the following cost function: TC(Q)-10+20+40, find the following A. Fixed cost B. Variable...
Name 4. For the following cost function: TC(Q)-10+20+40, find the following A. Fixed cost B. Variable cost C. Average fixed cost D. Average variable cost E. Average total cost Given the production function: Q = 4(KL)n, w = 16, r-25, and capital is fixed at level Ka. a. Find the short-run total cost as a function of Q: STC(Q) b. Find the short-run variable cost as a function of Q: VC(o) c. Find the short-run fixed cost as a function...
2. Determine the returns to scale of the following functions. Show your work. a) Q=4K +...
2. Determine the returns to scale of the following functions. Show your work. a) Q=4K + 3L b) Q= 2KL c) Q 10K/L Given fixed cost = $10 and the total cost given belowcompletethetable assumingfixed price of$8.00. Total Product AVC ATC TR Profit AFC TC MC 20 28 lo Io 20 -12 lG 24 -12 3.13 2.5 36 40 48 58 72 90 110 2o 9 4o 48 I.cc 87 8.28 ty 25225 一 s0 . 30 10 10
Name 3. For each of the following production functions below, find the LR total cost as...
Name 3. For each of the following production functions below, find the LR total cost as a function of Q: TC(O) LR average total cost as a function of Q: ATCO) .R average total cost vary with Q? (Hint, find the derivative: dATC(Qydo) Does this cost t function exhibit economies of scale, diseconomies of scale, or constant returns to scale? A. Q-4L2 B. Q-2L C. Q-L Given fixed cost S10 and the total cost given below complete the table assuming...
Suppose a firm's production function is Q = (KL)0.5. In the short run, this firm's capital stock ...
Suppose a firm's production function is Q = (KL)0.5. In the short run, this firm's capital stock is fixed at 100. Calculate the firm's short run total cost curve if w = 5 and v = 5. It can be shown (using calculus) that this firm's short run marginal costs are .1Q. In order to maximize its profits, how much would the firm choose to produce if the market price of its output was $5, $10, or $20. For each...
Given fixed cost-$10 and the total cost given below complete the table assuming fixed price of...
Given fixed cost-$10 and the total cost given below complete the table assuming fixed price of $8,00 Total Product 0 AFC TC MC TR Profit lo 20 28 -12 2.1 24 4 36 40 48 58 72 90 19 110 4o 6 48 s.2s io a) Complete all of the blanks above. b) At a price of $8.00, will this firm produce in the short run? If yes, how much does it produce? c) At a price of $8.00, will...
Consider a firm whose production function is Q = 0.4K0.5 L0.5. Its level of capital is...
Consider a firm whose production function is Q = 0.4K0.5 L0.5. Its level of capital is fixed at 100 units, the price of labor is PL = $4 per unit, and the price of capital is PK = $2 per unit. Given this information, the firm's cost structure is given by: Group of answer choices TFC = 200, TVC = Q2/4, TC = 200 + Q2/4, AFC = 200/Q, AVC = Q/4, ATC = 200/Q + Q/4, MC = Q/2...
Let q = 10 KL where w = v= 5. Also, let the amount of capital...
Let q = 10 KL where w = v= 5. Also, let the amount of capital be fixed at K= 4. a. Find the short run cost function. b. Fill in the following table for short run costs: FC VC с SRAC 9- 20 40 60 80 Earlier, we found the LRAC = 1 for this production function (K = Lin the LR). C. Graph the SRAC and this LRAC (on the same graph). Make sure to identify the SRAC...
Question 3.(12 points). Suppose a firm has a short-run cost function: C(q) = 1000 + 2009...
Question 3.(12 points). Suppose a firm has a short-run cost function: C(q) = 1000 + 2009 - 5q2 + 0.573. What are the fixed cost (F), the variable cost function (VC), the marginal cost (MC), the average cost (AC), the average fixed cost (AFC) and the average variable cost (AVC)?
10. Consider the production function: f(KL)=K L. Let wandr denote the price of labor and capital,...
10. Consider the production function: f(KL)=K L. Let wandr denote the price of labor and capital, and let p denote the price of the output good. (a) Find the cost minimizing input bundle and the cost function as a function of w., and q. (b) Find the profit maximizing output level and the profit as a function of w, r, and p. 11. Consider the production function: f(KL)=K+L. Let w and r denote the price of labor and capital, and...
1. Suppose a production function is given by FIK... - KL? the price of capital is...
1. Suppose a production function is given by FIK... - KL? the price of capital is $10 and the price of labor $15. Find the combination of labor and capital minimizes the cost of producing 1296 units in the following two scenarios 2. In the short run the amount of capital is set and is equal to K-36. 1 In the long run you are able to optimally choose the amount of labor and capital Show the isoquant and isocosts...
Name 4. For the following cost function: TC(Q)-10+20+40, find the following A. Fixed cost B. Variable cost C. Average fixed cost D. Average variable cost E. Average total cost Given the production function: Q = 4(KL)n, w = 16, r-25, and capital is fixed at level Ka. a. Find the short-run total cost as a function of Q: STC(Q) b. Find the short-run variable cost as a function of Q: VC(o) c. Find the short-run fixed cost as a function...
2. Determine the returns to scale of the following functions. Show your work. a) Q=4K + 3L b) Q= 2KL c) Q 10K/L Given fixed cost = $10 and the total cost given belowcompletethetable assumingfixed price of$8.00. Total Product AVC ATC TR Profit AFC TC MC 20 28 lo Io 20 -12 lG 24 -12 3.13 2.5 36 40 48 58 72 90 110 2o 9 4o 48 I.cc 87 8.28 ty 25225 一 s0 . 30 10 10
Name 3. For each of the following production functions below, find the LR total cost as a function of Q: TC(O) LR average total cost as a function of Q: ATCO) .R average total cost vary with Q? (Hint, find the derivative: dATC(Qydo) Does this cost t function exhibit economies of scale, diseconomies of scale, or constant returns to scale? A. Q-4L2 B. Q-2L C. Q-L Given fixed cost S10 and the total cost given below complete the table assuming...
Given fixed cost-$10 and the total cost given below complete the table assuming fixed price of $8,00 Total Product 0 AFC TC MC TR Profit lo 20 28 -12 2.1 24 4 36 40 48 58 72 90 19 110 4o 6 48 s.2s io a) Complete all of the blanks above. b) At a price of $8.00, will this firm produce in the short run? If yes, how much does it produce? c) At a price of $8.00, will...
Let q = 10 KL where w = v= 5. Also, let the amount of capital be fixed at K= 4. a. Find the short run cost function. b. Fill in the following table for short run costs: FC VC с SRAC 9- 20 40 60 80 Earlier, we found the LRAC = 1 for this production function (K = Lin the LR). C. Graph the SRAC and this LRAC (on the same graph). Make sure to identify the SRAC...
Question 3.(12 points). Suppose a firm has a short-run cost function: C(q) = 1000 + 2009 - 5q2 + 0.573. What are the fixed cost (F), the variable cost function (VC), the marginal cost (MC), the average cost (AC), the average fixed cost (AFC) and the average variable cost (AVC)?
10. Consider the production function: f(KL)=K L. Let wandr denote the price of labor and capital, and let p denote the price of the output good. (a) Find the cost minimizing input bundle and the cost function as a function of w., and q. (b) Find the profit maximizing output level and the profit as a function of w, r, and p. 11. Consider the production function: f(KL)=K+L. Let w and r denote the price of labor and capital, and...
1. Suppose a production function is given by FIK... - KL? the price of capital is $10 and the price of labor $15. Find the combination of labor and capital minimizes the cost of producing 1296 units in the following two scenarios 2. In the short run the amount of capital is set and is equal to K-36. 1 In the long run you are able to optimally choose the amount of labor and capital Show the isoquant and isocosts...
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