A production function is given by: Q
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A production function is given by: Q = 2Kx/3L5x/3 + 3K3x/5L7x/5. a) Comment on the function’s homogeneity and returns to scale. b) What happens if the capital and the labor are tripled?
5. Find the optimal values of capital (K) and labor (N) given the production function: Q = 100[0.2K0.5 + 0.8Nº.512 subject to the constraint: 10K + 4N = 4100 (10 points)
Let the production function be q=ALK. The function exhibits increasing returns to scale if O A. a + b < 1 O B. a + b > 1 OC. a + b = 1 O D. Cannot be determined with the information given
Find the optimal values of capital (K) and labor (N) given the production function: Q = 100[0.2K0.5 + 0.8N0.5]2 subject to the constraint: 10K + 4N = 4100
What returns to scale does this production function have? Q = L + K Q = 50LK; • w = per unit cost of labor; • r = per unit cost of capital Use MPL ... (1) & Q = 50LK .... (2) to find out mathematical expressions of L*, K*and TC(Q,w,r) = wŁ* + rK*
Is the following production function homogeneous? If so, find the degree of homogeneity and comment on the returns to scale! Q = 4K L This production function homogeneous What is the degree of homogeneity of the production function? This function displays returns to scale.
VK2L has 8. The production function q returns to scale.
Consider a production function of three inputs, labor, capital, and materials, given by Q= LKM. The marginal products associated with this production function are as follows: MPL = KM, MPk = LM, and MPM = LK. Let w = 5, r = 1, and m = 2, where m is the price per unit of materials. (a) Suppose that the firm is required to produce Q units of output. Show how the cost-minimizing quantity of labor depends on the quantity Q....
What can you say about the returns to scale of the linear production function Q = aK + bL, where a and b are positive constants?
For the production function Q = 8L2K2, returns to scale: is increasing. is constant. is decreasing. n be increasing, decreasing, or constant depending on the values of L and
For the production function Q = 3L + K, returns to scale: is constant is increasing is decreasing Can be increasing, decreasing, or constant depending on the values of Land K.