a)
i) As per given cost, ration of input cost will be 50/5 = 10
Ratio of marginal product = 12
Since both ratio are not equal, hence restaurant will not be able to minimize its cost of production.
ii) To minimize the cost of production, restaurant should use more capital and less labor.
Question 2 A local fast food restaurant pays $5 per hour to workers and $50 per...
A fast food restaurant currently pays $5 per hour for servers and $50 per hour to rent ovens and other kitchen machinery. The restaurant is using the amount of machinery and labor such that MPk/MP-12. Is the restaurant minimizing its cost of production? Show your work. 2. 3. Conigan Box Company produces cardboard boxes that are sold in bundles of 1000 boxes. The market is highly competitive, with boxes currently selling for $100 per thousand. Conigan's total and marginal cost...
Please explain in details with step-by-step solution, Thank you so much c) Davy metal company produces brass fittings. Davy's engineers estimate the production function represented below as relevant for their long run capital-labor decisions. where O-annual output measured in kilograms L- labor measured in person hours Kcapital measured in machine hours Davy's employees are relatively highly skilled and earn S15 per hour. The firm estimates a rental charge of $50 per hour on capital. Davy forecasts annual costs of S500,000...
Question 1 Sachith CADs production function for a given level of technology is given by q 0.25K0.25L0.75. Where q is the amount of prints per hour. Suppose the rental rate per printing machine is $52 per hour, and labor can be hired at $12 per worker hour. The company has allocated $150,000 for the initial run of prints. a. Calculate marginal products of labor and capital. b. Determine the firm's optimal capital-labor ratio (labor on the x axis) c. Construct...
4. Davy Metal Company produces brass fitings. Davy's engineers estimate the production function represented below as relevant for their long-run capital-labor decisions. 500L0.6K0.8, where Q- annual output measured in pounds, L - labor measured in person hours, K -capital measured in machine hours. The marginal products of labor and capital are therefore MPL-300L-0.4K0.8 MPK-400L0.6K-0.2 Davy's employees are relatively highly skilled, so labour costs 15 per hour. The firm estimates a rental charge of є50 per hour on capital. Davy forecasts...
Davy Metal Company produces brass fittings. Davy's engineers estimate the production function represented below as relevant for their long-run capital-labor decisions. Q = 500L0.6K0.8, where Q = annual output measured in pounds, L = labor measured in person hours, K = capital measured in machine hours. The marginal products of labor and capital are: MPL = 300L-0.4K0.8 MPK = 400L0.6K-0.2 Davy's employees are relatively highly skilled and earn $15 per hour. The firm estimates a rental charge of $50 per...
5. The marginal product of labor in the production of computer chips is 50 chips per hour. The marginal rate of technical substitution of hours of labor for hours of machine capital is 1/2. What is the marginal product of capital? 6. Suppose that a firm's production function is q = 10LT/2K1/2. The cost of a unit of labor is $20 and the cost of a unit of capital is $80. a. The firm is currently producing 100 units of...
QUESTION 10 Acme Eggs produces eggs. Acme has estimated this production function for its eggs: Q = 10L".SK.) The marginal product of labor is given by MPL =5L-0.5 K.S and the marginal product of capital is given by MPx=520.5 -0.5 where Q = output measured in eggs, L = labor measured in person hours, and K = capital measured in machine hours. Acme currently pays a wage of $15 per hour and considers the relevant rental price for capital to...
eferences Mailings Review ViewTable Design Layout Question XYZ restaurant sells donuts at $2 per unit. It uses capital (which it rents at $5 per hour under a contract for 5 and labor (which is paid a wage of $150 per hour of labor services). Complete the following table and use that information to answer the following questions. VC MPL APL VML FC 100 25 50 75 50 150 25-50 125 125100 625 200 2 300 125 75 250 450 225...
Question 5 (1 point) Labor Total product (workers per day)| (hats per day) 1 10 18 5 25 30 5. The above table shows the total product of producing baseball hats. The average product of 3 workers is equal to 1.67 baseball hats. 12.78 baseball hats. 18.00 baseball hats. 6.00 baseball hats. Question 6 (1 point) 6. The law of diminishing marginal returns says that as the firm uses more of - with a given quantity of product of the...
I need Summary of this Paper i dont need long summary i need What methodology they used , what is the purpose of this paper and some conclusions and contributes of this paper. I need this for my Finishing Project so i need this ASAP please ( IN 1-2-3 HOURS PLEASE !!!) Budgetary Policy and Economic Growth Errol D'Souza The share of capital expenditures in government expenditures has been slipping and the tax reforms have not yet improved the income...