1. [Multi-product Firm’s Profit Maximization] Find (i) the profit maximizing output levels x and y and...
1. [Multi-product Firm’s Profit Maximization]
Find (i) the profit maximizing output levels x and y and (ii) the maximum profit for a firm producing two goods x and y with the profit function
π(x, y) = 86x−2x2 −2xy−4y2 +120y−200.
Homework Answers
Add Answer to:
1. [Multi-product Firm’s Profit Maximization]
Find (i) the profit maximizing output levels x and y and...
A price-taking and profit-maximizing firm produces one output at the rate y> 0 using one input...
A price-taking and profit-maximizing firm produces one output at the rate y> 0 using one input r>0 by way of the production function () , where f(x)竺2x2 . The firm's output sells at the price p >0 while the input is purchased at the price wo (a) (b) (c) Determine the lalue of the input that solves the FONC, and denote it by x (p,w). Is Set up the profit maximization problem. Derive the FONC and SOSC. x(p,w) unique? Explain....
1.1. What is the set of profit-maximizing inputs if the profit function of a firm is...
1.1. What is the set of profit-maximizing inputs if the profit function of a firm is given by: π(X, Y) = P ln[X + aY] – wX – wY where P - price of output f(X,Y) = ln[X + 0.5Y] - production function X - input 1, X>=0 Y - input 2, Y>=0 w - same price of input for inputs 1 and 2 a - parameter between 0 and 1 1.2 What is the set of profit-maximizing inputs if...
Suppose the short run cost function for a competitive firm is C(Y)= 4Y2+ 200 where Y...
Suppose the short run cost function for a competitive firm is C(Y)= 4Y2+ 200 where Y is the total output. Find the profit maximizing supply for the firm if the output price is $16 and the maximum profit. What is its short run decision: To produce or not to produce?
Consider a profit maximizing firm that uses a Cobb-Douglas production function Y = AKαL 1−α and...
Consider a profit maximizing firm that uses a Cobb-Douglas production function Y = AKαL 1−α and hires labor L at wage rate w and capital K at rental rate r. (1) Set up the profit-maximization problem of the firm and derive the first-order condition for the profit-maximizing choice of capital. (2) Show that the marginal product of capital is a decreasing function of capital. (3) Solve for the optimal choice of capital and show that the optimal choice of capital...
B. A firm produces and sells two commodities. By selling x tons of the first commodity...
B. A firm produces and sells two commodities. By selling x tons of the first commodity the firm gets a price per ton given by p = 96 – 4x. By selling y tons of the other commodity the price per ton is given by q = 84 – 2y. The total cost of producing and selling x tons of the first commodity and y tons of the second is given by C(x, y) = 2x2 + 2xy + y2....
5. Suppose that a firm's total profit function is P(x,y) = 2xy + 2y+12-(2x2 +y2), where...
5. Suppose that a firm's total profit function is P(x,y) = 2xy + 2y+12-(2x2 +y2), where x is amount of production and sales of the first product and y - of the second produc 1) Find all first and second order partial derivatives. 2) Find values of x and y that maximize the profit. Find the maximum profit. 6. Ifx thousand euros is spend on labor and y thousand euros is spend on equipment, the outpu certain factory will be...
3. Consider a firm with the production function F(KL)=1/31/3 You will be solving the profit maximization...
3. Consider a firm with the production function F(KL)=1/31/3 You will be solving the profit maximization for this firm with both the two step and I step methods and proving that the final answers are identical. This big problem is broken up into the following smaller parts: (a) Setup and solve the long run cost minimization problem for the long run optimal amount of capital K*(w,,9) and labor L*(w,r.9), and the long run minimized cost C*(w, 5,9). (Hint: reduce the...
Problem 3 - Profit Maximization Consider the case of a firm that produces output x (sold...
Problem 3 - Profit Maximization Consider the case of a firm that produces output x (sold at price p) using a production function x = A*1941-a-Beß, where lis labor, k is capital, and e is energy (for example, oil or electricity). a) What is the interpretation of A? b) Under what condition(s) does the production function exhibit constant returns to scale? Is it homogeneous? Are the marginal products of inputs increasing, constant, or decreasing? c) Set up the profit maximization...
1. If a profit-maximizing competitive firm has constant returns to scale, then its long-run profits must...
1. If a profit-maximizing competitive firm has constant returns to scale, then its long-run profits must be zero. True or False? Explain your answer. 2. A firm is producing output using one variable factor of production. The firm’s production function is y = 8x¹ˡ². The price of the output is $24 and the price of input is $8 per unit. How many units of the input should the firm use?
A competitive firm uses a single input x to produce its output y. The firm’s production...
A competitive firm uses a single input x to produce its output y. The firm’s production function is given by y = x3/2 for quantities of x between 0 and 4. For quantities of a greater than 4, the firm’s output is y = 4 + x. If the price of the output y is $1 and the price of the input x is $3, how much x should the firm use to maximize its profit? answer is 0.
A price-taking and profit-maximizing firm produces one output at the rate y> 0 using one input r>0 by way of the production function () , where f(x)竺2x2 . The firm's output sells at the price p >0 while the input is purchased at the price wo (a) (b) (c) Determine the lalue of the input that solves the FONC, and denote it by x (p,w). Is Set up the profit maximization problem. Derive the FONC and SOSC. x(p,w) unique? Explain....
B. A firm produces and sells two commodities. By selling x tons of the first commodity the firm gets a price per ton given by p = 96 – 4x. By selling y tons of the other commodity the price per ton is given by q = 84 – 2y. The total cost of producing and selling x tons of the first commodity and y tons of the second is given by C(x, y) = 2x2 + 2xy + y2....
5. Suppose that a firm's total profit function is P(x,y) = 2xy + 2y+12-(2x2 +y2), where x is amount of production and sales of the first product and y - of the second produc 1) Find all first and second order partial derivatives. 2) Find values of x and y that maximize the profit. Find the maximum profit. 6. Ifx thousand euros is spend on labor and y thousand euros is spend on equipment, the outpu certain factory will be...
3. Consider a firm with the production function F(KL)=1/31/3 You will be solving the profit maximization for this firm with both the two step and I step methods and proving that the final answers are identical. This big problem is broken up into the following smaller parts: (a) Setup and solve the long run cost minimization problem for the long run optimal amount of capital K*(w,,9) and labor L*(w,r.9), and the long run minimized cost C*(w, 5,9). (Hint: reduce the...
Problem 3 - Profit Maximization Consider the case of a firm that produces output x (sold at price p) using a production function x = A*1941-a-Beß, where lis labor, k is capital, and e is energy (for example, oil or electricity). a) What is the interpretation of A? b) Under what condition(s) does the production function exhibit constant returns to scale? Is it homogeneous? Are the marginal products of inputs increasing, constant, or decreasing? c) Set up the profit maximization...
Most questions answered within 3 hours.
-
Please design 3 different and unique brackets consisting of TOP,
FRONT, RIGHT or LEFT views with...
asked 15 minutes ago -
La Niña conditions are forecasted to result in dry conditions in
the spring. You are trying...
asked 23 minutes ago -
The YTM on a 6-month $20 par value zero-coupon bond is 18%, and
the YTM on...
asked 24 minutes ago -
Write In JAVA:
Part 1
The use of computers in education is referred to as
computer-assisted...
asked 31 minutes ago -
Show all of your work and use the half-reaction method
for acidic redox reactions.
1.
H2O2aq+...
asked 32 minutes ago -
The Harry and Belinda Johnson Family Might Have a Career
Change
Harry has started out fine...
asked 39 minutes ago -
Tyler Company acquired all of Jasmine Company’s outstanding
stock on January 1, 2016, for $244,700 in...
asked 41 minutes ago -
In the guanidinium ion, [C(NH2)3] + , what is the best
description of the hybridizations of...
asked 45 minutes ago -
Could you please explain, how this code works?
public void addAfter(int element){
if (this.manyItems == 0){...
asked 56 minutes ago -
Does the complexity of the project dictate the estimating
method?
asked 52 minutes ago -
in regards to the movie FRIDA,
The movie has as its background the Mexican Revolution, thus:...
asked 57 minutes ago -
a) A given electrical circuit operating on "V" volts with "R"
ohms of resistance draws 5.8...
asked 1 hour ago