AUS electronics manufacturer is considering moving its production abroad. Suppose its production function is q=L0604 In...
A U.S. electronics manufacturer is considering moving its production abroad. Suppose its production function is q=L^0.7K^0.3 In the United States, w=$7 and r=3. In Mexico, the wage is 50% lower than in the United States but the firm faces the same cost of capital: w*=$3.50 and r*=3 In the U.S., L is ___, K is ___, and the cost of production is ____ In Mexico, L is ____, K is _____, and the cost of production is _____
AU.S. apparel manufacturer is considering moving its production abroad. Suppose its production function is: q=L0.60 0.40 In the United States, w = 6 and r = 4. At its Asian plant, the firm will pay a 50% lower wage and a 50% higher cost of capital: w* = 6/1.50 and r* = 1.50 x 4. What are L and K and what is the cost of producing q = 100 units in both countries? (for all responses, enter a real...
for Asia. Find L K and cost of production
AU.S. apparel manufacturer is considering moving its production abroad. Suppose its production function is: q=0.80 0.20 In the United States, w=8 and 2. At its Asian plant, the firm will pay a 50% lower wage and a 50% higher cost of capital: w = 8/1.50 and r* = 1,50x2. What are L and K and what is the cost of producing 9 = 100 units in both countries? (for all responses,...
A US electronics firm is considering moving its production to a plant in Mexico. Its estimated production function is q = 10L0.32K0.56. In the US, the wage rate and the rental cost of capital are same and equal to $15. At the Mexican plant, the firm will pay a 10% lower wage and a 10% higher cost of capital. a) (10 points) What are the L and K and cost of producing q = 250 units in both countries? b)...
Number 3 please
1. Diaw some Boquants for this production function (1.2) = min {x1 + x2, 2x2). (6 points) 2. Consider this production function f(x1,x2) = x, + x,. Does it exhibit decreasing, constant, or increasing returns to scale? (6 points) 3. A competitive firm has the production function y=Z, where y is the quantity of output and Z the amount of labor used. (a) Suppose the hourly wage rate for labor is w = $10 and the price...
1. A firm operates in the long run. Its long-run production function is given as: Q = LK, where Qis units of output, Lis units of labor, and K is units of capital. (a) Obtain six integer combinations of Land K when Q = 12. (b) Obtain six integer combinations of Land K when Q = 18. (c) Use the twelve integer combinations of Land K obtained in parts (a) and (b) to construct two isoquants on a two-dimensional plane....
2. A company is producing toasters. Its production function is given by qf(L, K) KL2. The company wants to produce 1,000 toasters per hour and the price of capital is $10 per hour. dq 2KL and MP a) The company is considering building a factory in Country A where the price of labor is $5 per hour. What combination of labor and capital minimizes the company's cost in Country A? b) The company is also considering building a factory in...
1. There is a furniture manufacturer using labor (L) and capital
(K) to produce tables. Its production function is given by q=
10L^.75 K^.40. It pays a
wage of $5 per hour and rents capital at a rate of $15. The firm
wants to find the cost-minimizing bundle of inputs to produce
10,000 tables. Assume K is on the y-axis in what
follows.
Write out the firm’s cost function.
Calculate the firm’s isocost equation.
What is the slope of the...
Afir's production engineers have estimated its production function as Q(KL) = 2K2/1/2 = 2-K L=2KL where ' and 'L' represent the amounts of capital and labour, respectively, used in production each period, and 'Q' represents the amount of output produced each period. The firm pays a wage, w, for each person-hour of labour of $16. The rental rate of a machine-hour of capital, wk, is $100. What will be the firm's minimum cost of producing 10 units of output? What...
2. Consider a firm producing pizza with production function q = KL, that faces input prices w= $10 and r = $100 for labor and capital, respectively. a. Derive the isoquant equation. Find the isoquant of an output q = 1. Draw it in a figure with l in the horizontal axis and k in the vertical axis. b. Does this firm's production exhibit increasing, decreasing or constant returns to scale? Briefly explain c. Find the labor demand, and the...