Homework Answers
Ans.-Statements A and E
L- shaped isoquants represent fixed proportions isoquants.
Statement A is true because in this diagram, inputs are perfect complements so inputs have to be used in fixed proportion. No input can be substituted for the other.
Statement E is true because inputs are perfect complements so inputs have to be used in fixed proportion.
All the other statements are False.
Add Answer to:
Consider the following diagram, which shows the production isoquants for a cost-minimizing firm with labor and...
5. The marginal product of labor in the production of computer chips is 50 chips 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...
Q1 [30 points] Show in a diagram using isoquants that a production function can have diminishing...
Q1 [30 points] Show in a diagram using isoquants that a production function can have diminishing marginal return to a factor and constant returns to scale? With the help of a diagram explain the concepts of "isoquant", "diminishing marginal return to a factor", and "constant returns to scale". What are the similarities and differences between indifference curves and isoquants. Q2 [30 points Assume that a firm has a fixed-proportions production function, in which one unit of output is produced using...
1. Sketch the production isoquant for a production function that takes two inputs (e.g. y = f[l,k]). Show the cost minim...
1. Sketch the production isoquant for a production function that takes two inputs (e.g. y = f[l,k]). Show the cost minimizing combination of inputs by adding an isocost line to your sketch. (a) What is the relationship between the trs and the relative price of one input compared to the other at the cost minimizing combination of inputs? (b) What does the assumption of a diminishing technical rate of substitution (trs) mean? (What does a diminishing trs mean imply for...
A6 Microeconomics Assignment 6 Part I: Short Answer Questions [(100 points) Q1 [30 points) Show in a diagram using isoquants that a production function can have diminishing marginal return to a f...
A6 Microeconomics Assignment 6 Part I: Short Answer Questions [(100 points) Q1 [30 points) Show in a diagram using isoquants that a production function can have diminishing marginal return to a factor and constant returns to scale? With the help of a diagram explain the concepts of "isoquant", "diminishing marginal return to a factor", and "constant returns to scale". What are the similarities and differences between indifference curves and isoquants. Q2 [30 points Assume that a firm has a fixed-proportions...
Suppose a firm has a production function given by Q=2K+L, where L is labor, K is...
Suppose a firm has a production function given by Q=2K+L, where L is labor, K is capital and Q is the quantity of output. Which of the following statements is WRONG? A. The firm is exhibiting constant returns to scale B. The firm’s marginal product of capital is constant C. The firm’s marginal product of labor is constant D. The firm’s marginal rate of technical substitution depends on the amount of inputs
A farmer uses three inputs to produce vegetables: land, labor, and capital
A farmer uses three inputs to produce vegetables: land, labor, and capital. The production function for the farm exhibits diminishing marginal rate of technical substitution. a. In the short run the amount of land is fixed. Suppose the prices of capital and labor both increase by 5%. What happens to the cost-minimizing quantities of labor and capital for a given level of output? (Remember that there are three inputs, one of which is fixed). b. Suppose only the cost of labor goes...
3. (a) "A firm's cost- minimizing choice of inputs to produce a given output level depends...
3. (a) "A firm's cost- minimizing choice of inputs to produce a given output level depends on the relative cost ween its inputs in the production process. of the inputs and the extent to which the firm can substitute bet Discuss the above quote with the aid of a diagram. s $5 per hour for servers and $50 per hour to rent ovens and other (b) A fast food restaurant currently pay ine whether the restaurant is minimizing its cost...
A firm is using 30 units of capital and 30 units of labor to produce 90...
A firm is using 30 units of capital and 30 units of labor to produce 90 units of output. Capital costs $500 per unit and labor $5,000 per unit. The last unit of capital added 5 units of output, while the last unit of labor added 45 units of output. The firm is /using the cost-minimizing combination of capital and labor. /should use more of both inputs in equal proportions. /should use less of both inputs in equal proportions. /could...
Suppose a firm produces an output level according to the simple production function: Q = 5...
Suppose a firm produces an output level according to the simple production function: Q = 5 L K, which implies M P L = 5 K and M P K = 5 L. Further suppose a firm must pay labor (L) a wage rate (w) of $5 per unit, and the rental rate (r) on capital (K) is $25 per unit. A. Find the marginal rate of technical substitution. B. Write the equation for the isocost line. What is the...
The marginal rate of technical substitution is a. the rate at which the firm can substitute...
The marginal rate of technical substitution is a. the rate at which the firm can substitute labor for capital while holding total cost constant. b. the rate at which the firm can substitute labor for capital while holding output constant. c. the slope of the isocost curve. d. both a and c e. none of the above
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...
Q1 [30 points] Show in a diagram using isoquants that a production function can have diminishing marginal return to a factor and constant returns to scale? With the help of a diagram explain the concepts of "isoquant", "diminishing marginal return to a factor", and "constant returns to scale". What are the similarities and differences between indifference curves and isoquants. Q2 [30 points Assume that a firm has a fixed-proportions production function, in which one unit of output is produced using...
A6 Microeconomics Assignment 6 Part I: Short Answer Questions [(100 points) Q1 [30 points) Show in a diagram using isoquants that a production function can have diminishing marginal return to a factor and constant returns to scale? With the help of a diagram explain the concepts of "isoquant", "diminishing marginal return to a factor", and "constant returns to scale". What are the similarities and differences between indifference curves and isoquants. Q2 [30 points Assume that a firm has a fixed-proportions...
3. (a) "A firm's cost- minimizing choice of inputs to produce a given output level depends on the relative cost ween its inputs in the production process. of the inputs and the extent to which the firm can substitute bet Discuss the above quote with the aid of a diagram. s $5 per hour for servers and $50 per hour to rent ovens and other (b) A fast food restaurant currently pay ine whether the restaurant is minimizing its cost...
Most questions answered within 3 hours.
-
For Bergson the concept of Being contains less reality than does
the concept of Becoming. True...
asked 55 minutes ago -
What is the hydroxide ion concentration, [OH-], in a solution
with a hydronium ion concentration, [H3O+]...
asked 41 minutes ago -
What species is the reducing agent in the following
equation?
Mg(s) + 2HCl (aq) --> MgCl2(aq)...
asked 57 minutes ago -
A 50g ice cube is taken out of a freezer at 0 degrees Celsius
and put...
asked 2 hours ago -
How do ratios help you determine trends? What specific
information do managers look at? Is there...
asked 2 hours ago -
A wavelength of 514 nm is used to find an unknown diffraction
grating. If the separation...
asked 2 hours ago -
Use the central limit theorem to find the mean and standard
error of the mean of...
asked 2 hours ago -
You will be given a file that will contain averages for classes
which are divided into...
asked 3 hours ago -
A Pew Research Center poll surveyed a random sample 850 voters
and asked them if they...
asked 3 hours ago -
Design a class named
NumDays, to
store a value that represents a number of hours and...
asked 3 hours ago -
(R)-2-chloro-(S)-3-bromobutane and
(S)-2-chloro-(S)-3-bromobutane are: A. enantiomers. B.
diastereomers. C. meso compounds. D. the same molecule.
asked 3 hours ago -
1_ What is the Frank-Starling law of the heart? And why the
heart cannot function on...
asked 3 hours ago