Your firm owns two plants that produce chocolate of exactly the same quality. One plant has...
Your firm owns two plants that produce chocolate of exactly the same quality. One plant has a cost function given by cA (y) = 4y2 while the other plant has a cost function given by cB (y ) = y2 + y + 4. Given that you can optimally choose how to distribute the production of chocolate across these two plants, what is your firm's marginal cost function for producing chocolate?
Homework Answers
Let output produced in plant 1 be y1 and in plant 2 be y2.
CA = 4y12
MC(A) = dCA/dy1 = 8y1
y1 = MC(A) / 8 = 0.125 x MC(A)
CB = y22 + y2 + 4
MC(B) = dCB/dy2 = 2y2 + 1
2y2 = MC(B) - 1
y2 = 0.5MC x (B) - 0.5
Setting MC(A) = MC(B) = MC:
y1 = 0.125 x MC
y2 = 0.5 x MC - 0.5
y = y1 + y2
y = 0.125 x MC + 0.5 x MC - 0.5
y = MC x (0.125 + 0.5) - 0.5
y = MC x 0.625 - 0.5
MC x 0.625 = y + 0.5
MC = (y + 0.5) / 0.625 = 1.6y + 0.8
Add Answer to:
Your firm owns two plants that produce chocolate of exactly the
same quality. One plant has...
A firm has two independently operated plants that make the same good using the same two inputs. They differ, however, i...
A firm has two independently operated plants that make the same good using the same two inputs. They differ, however, in the technology of production. One plant produces output according to the production function ~a22- while the other plant produces output according to the product on What is the firm's cost function c(w, w2,q)? b,1-b
A firm has two independently operated plants that make the same good using the same two inputs. They differ, however, in the technology of production....
Consider a firm operating two plants. It can produce good X and Y in either plant,...
Consider a firm operating two plants. It can produce good X and Y in either plant, and the PPF of each plant is listed below. • Plant 1: y = 100 - 0.5X Plant 2: y2 + 400 -0.01x2? The firm currently produces only good X in plant 1 and only good Y in plant 2. Follow the steps below to find out if the current output bundle is on the PPF of the firm. The firm currently produces units...
The Move-it Company has two plants that produce forklifts and then ships them to three distribution centers. The production costs are the same at the two plants and the cost of shipping each forklift...
The Move-it Company has two plants that produce forklifts and then ships them to three distribution centers. The production costs are the same at the two plants and the cost of shipping each forklift is shown in the following table. Transportation Costs Distribution Center 1 Distribution Center 2 Distribution Center 3 Plant A $800 $700 $260 Plant B $600 $800 $280 A total of 60 forklifts are produced and shipped each week. Each plant can produce up to 50 forklifts...
Beta Inc. has two production plants that use finely divisible labor to produce its output. The...
Beta Inc. has two production plants that use finely divisible labor to produce its output. The marginal product of labor at plant 1 is MP1L=100/L1MPL1=100/L1 and the marginal product of labor at plant 2 is MP2L=250/L2.MPL2=250/L2. Beta Inc. wants to find the best assignment of 210 workers between the two plants. What is it? Instructions: Enter your answers as whole numbers. Beta Inc. should assign workers to plant 1 and workers to plant 2.
A firm uses two inputs x1 and x2 to produce output y. The production function is...
A firm uses two inputs x1 and x2 to produce
output y. The production function is given by f(x1, x2) = p
min{2x1, x2}. The price of input 1 is 1 and the price of input 2 is
2. The price of output is 10.
4. A firm uses two inputs 21 and 22 to produce output y. The production function is given by f(x1, x2) = V min{2x1, x2}. The price of input 1 is 1 and the price...
Need to know the same thing for Plant 2 too. Suppose a firm has two plants...
Need to know the same thing for Plant 2 too.
Suppose a firm has two plants with the following costs: Plant 1 C1 q-3003-2,400q2+1,000,000q and Plant 2. C2 = q4-45q3-3,000q2 + 2,000 000q. At what output is the average cost minimized in each plant? Plant 1 average costs are minimized at output q= (Enter a numeric response using an integer.)
A firm has two plants that produce identical output. The cost functions are C7 = 2519-202²...
A firm has two plants that produce identical output. The cost functions are C7 = 2519-202² +0.593 and C2 = 2519 – 14q² + 1.00 At what output level does the average cost curve of each plant reach its minimum? The first plant reaches minimum average cost at units of output. (Enter a numeric response using an integer.)
Information P Flag question Consider a firm operating two plants. It can produce Good X and...
Information P Flag question Consider a firm operating two plants. It can produce Good X and Y in either plant, and the PPF of each plant is listed below. • Plant 1: Y1 = 100 -0.01x? • Plant 2: y2 = 400 - 0.1X2 The firm currently produces only Good X in Plant 1 and only Good Y in Plant 2. Follow the steps below to find out if the current output bundle is on the PPF of the firm....
Consider a cost-minimizing firm that uses two inputs x, and x, to produce output y from...
Consider a cost-minimizing firm that uses two inputs x, and x, to produce output y from the production function y=x"X, where a >0 and B>0. The competitive input prices of x, and x, are given respectively as w, and wz. a) Find the firm's demand functions for inputs x, and xz. b) Find the firm's total cost, average cost, and marginal cost functions. c) Show that if a +B>1 then average cost is always greater than marginal cost.
Please answer the following miscellaneous questions about production and justify your answers. (a) A firm produces...
Please answer the following miscellaneous questions about production and justify your answers. (a) A firm produces identical outputs at two different plants. If the marginal cost at the first plant exceeds the marginal cost at the second plant, how can the firm reduce costs and maintain the same level of output? (b) True or false? In the long run,a firm always operates at the minimum level of average costs for the optimally sized plant to produce a given amount of...
A firm has two independently operated plants that make the same good using the same two inputs. They differ, however, in the technology of production. One plant produces output according to the production function ~a22- while the other plant produces output according to the product on What is the firm's cost function c(w, w2,q)? b,1-b
A firm has two independently operated plants that make the same good using the same two inputs. They differ, however, in the technology of production....
Consider a firm operating two plants. It can produce good X and Y in either plant, and the PPF of each plant is listed below. • Plant 1: y = 100 - 0.5X Plant 2: y2 + 400 -0.01x2? The firm currently produces only good X in plant 1 and only good Y in plant 2. Follow the steps below to find out if the current output bundle is on the PPF of the firm. The firm currently produces units...
A firm uses two inputs x1 and x2 to produce
output y. The production function is given by f(x1, x2) = p
min{2x1, x2}. The price of input 1 is 1 and the price of input 2 is
2. The price of output is 10.
4. A firm uses two inputs 21 and 22 to produce output y. The production function is given by f(x1, x2) = V min{2x1, x2}. The price of input 1 is 1 and the price...
Need to know the same thing for Plant 2 too.
Suppose a firm has two plants with the following costs: Plant 1 C1 q-3003-2,400q2+1,000,000q and Plant 2. C2 = q4-45q3-3,000q2 + 2,000 000q. At what output is the average cost minimized in each plant? Plant 1 average costs are minimized at output q= (Enter a numeric response using an integer.)
A firm has two plants that produce identical output. The cost functions are C7 = 2519-202² +0.593 and C2 = 2519 – 14q² + 1.00 At what output level does the average cost curve of each plant reach its minimum? The first plant reaches minimum average cost at units of output. (Enter a numeric response using an integer.)
Information P Flag question Consider a firm operating two plants. It can produce Good X and Y in either plant, and the PPF of each plant is listed below. • Plant 1: Y1 = 100 -0.01x? • Plant 2: y2 = 400 - 0.1X2 The firm currently produces only Good X in Plant 1 and only Good Y in Plant 2. Follow the steps below to find out if the current output bundle is on the PPF of the firm....
Consider a cost-minimizing firm that uses two inputs x, and x, to produce output y from the production function y=x"X, where a >0 and B>0. The competitive input prices of x, and x, are given respectively as w, and wz. a) Find the firm's demand functions for inputs x, and xz. b) Find the firm's total cost, average cost, and marginal cost functions. c) Show that if a +B>1 then average cost is always greater than marginal cost.
Most questions answered within 3 hours.
-
M. Laing has suggested a new arrangement of the periodic table
(J.Chem.Ed.1989, 66,
746). Answer the following...
asked 18 minutes ago -
Café Michigan's manager, Gary Stark, suspects that demand for
mocha latte coffees depends on the price...
asked 17 minutes ago -
A US merchant purchases wine from a vineyard outside of Paris.
The wine is transported to...
asked 23 minutes ago -
we have (TTN)*
We have to use just one 2-bit counter with 1-bit global
history?
and...
asked 24 minutes ago -
Firms that fail to compete with lower prices and/or better
products will go bankrupt. Does this...
asked 25 minutes ago -
Question 1 Current and Resistance
Part A: A current of -14.5 nanoamperes is how many electrons...
asked 26 minutes ago -
The population standard deviation for the height of college
basketball players is 3.4 inches. If we...
asked 38 minutes ago -
6.) Use valence bond theory to describe the number and types of
hybrid bonding orbitals on...
asked 40 minutes ago -
2. Define/explain the following traits that are important
adaptations for different types of vertebrate animals:
Jaws...
asked 40 minutes ago -
Firm K produced 45,000 radios using 9,000 hours of labor in
2003; total labor costs were...
asked 41 minutes ago -
Use the information in the table to answer the
question.
Year
2015
2016
2017
2018
Nominal...
asked 46 minutes ago -
Kelso Corporation just paid a dividend of D_0 = $1.50 per
share, and that dividend is...
asked 47 minutes ago