Suppose the production of paved roadways is represented as Q(L,K) = LK + L. Based on...
Suppose the production of paved roadways is represented as Q(L,K) = LK + L. Based on this production function, which of the following statements is (are) TRUE?
A. In the short-run when capital is held constant, labor exhibits the law of diminishing returns.
B. The isoquants for paved roadways are downward sloping and convex to the origin.
C. The production function exhibits constant returns to scale.
D. Both a and b are true.
E. Both b and c are true.
F. None of the above statements are true.
Homework Answers
Add Answer to:
Suppose the production of paved roadways is represented as
Q(L,K) = LK + L. Based on...
a. Suppose that a firm has the Cobb-Douglas production function = 12K0.75 0.25. Because this function...
a. Suppose that a firm has the Cobb-Douglas production function = 12K0.75 0.25. Because this function exhibits returns to scale, the long-run average cost curve is , whereas the long-run total cost curve is upward-sloping, with slope. b. Now suppose that the firm's production function is = KL. Because this function exhibits returns to scale, the long-run average cost curve is upward-sloping , whereas the long-run total cost curve is upward-sloping, with slope. a. Suppose that a firm has the...
1. A production function is given by f(K, L) = L/2+ v K. Given this form,...
1. A production function is given by f(K, L) = L/2+ v K. Given this form, MPL = 1/2 and MPK-2 K (a) Are there constant returns to scale, decreasing returns to scale, or increasing returns to scale? (b) In the short run, capital is fixed at -4 while labor is variable. On the same graph, draw the 2. A production function is f(LK)-(L" + Ka)", where a > 0 and b > 0, For what values of a and...
Consider the production function given by y = f(L,K) = L^(1/2) K^(1/3) , where y is...
Consider the production function given by y = f(L,K) = L^(1/2) K^(1/3) , where y is the output, L is the labour input, and K is the capital input. (a) Does this exhibit constant, increasing, or decreasing returns to scale? (b) Suppose that the firm employs 9 units of capital, and in the short-run, it cannot change this amount. Then what is the short-run production function? (c) Determine whether the short-run production function exhibits diminishing marginal product of labour. (d)...
QUESTION 7 The function q= 2K + L exhibits: a. constant returns to scale b. increasing...
QUESTION 7 The function q= 2K + L exhibits: a. constant returns to scale b. increasing returns to scale c. decreasing returns to scale d. any of the above depending on the values for K and L 10 points QUESTION 8 The short run is defined to be the period of time during which: a. at least one input is fixed b. all inputs are variable c. at least one input is variable d. all inputs are fixed 10...
Acme produces anvils using labor (L) and capital (K) according to the production function Q= f(L,K)=LK...
Acme produces anvils using labor (L) and capital (K) according to the production function Q= f(L,K)=LK with associated marginal products MPL=K, MPK =L. The price of labor is w=2 and the price of capital is r=1. Does Acme's production function for anvils exhibit increasing, constant or decreasing returns to scale? Justify your answer
1. Consider a firm that has the following CES production function: Q = f(L,K) = [aLP...
1. Consider a firm that has the following CES production function: Q = f(L,K) = [aLP + bK°]!/p where p a. Derive the MRTS for this production function. Does this production function exhibit a diminishing MRTS? Justify using derivatives and in words. What does this imply about the shape of the corresponding isoquants? (10 points) b. What are the returns to scale for this production function? Show and explain. Explain what will happen to cost if the firm doubles its...
Question 4 a) The firm ACME has the production function f ( K , L)=K 2...
Question 4 a) The firm ACME has the production function f ( K , L)=K 2 3 L 2 3 . Calculate an expression for the marginal product of labour, L , and establish if it is increasing, constant or decreasing. Verify if ACME’s production technology exhibits diminishing, constant or increasing returns to scale. (6p) b) Set up ACME’s long run profit maximization problem and derive the factor demands for optimal choice of y. Question 5 (Credit question) Try to...
7. Assume that the long-run production function can be expressed as Q-SKL? Where Q is quantity...
7. Assume that the long-run production function can be expressed as Q-SKL? Where Q is quantity of output, K is the quantity of capital and L is the quantity of labor. If capital is fixed at 10 units in the short run then the short-run production function is: Q=10KL b. Q=50KL? Q=10L? d. 0=50L Q=500KL 8. For a linear total cost function: a. MC will be downward sloping b. MC = AVC c. AVC is upward sloping and linear d....
A company has the production function Q = min{K, L}. The price of capital is $50...
A company has the production function Q = min{K, L}. The price of capital is $50 per unit while the price of labor is $75 per unit. On a graph, plot isoquants for quantities 10, 20, and 30, as well as the isocost line for a quantity of 20. Note the cost-minimizing levels of capital and labor on your graph given the target production level of 20 units. The McCue Corporation is a house-painting business. For a standard-sized house, it...
Suppose that q 30, L 2, and K-10 is a point on the production function q=f(L,...
Suppose that q 30, L 2, and K-10 is a point on the production function q=f(L, K) Is it posssible for q 30, L 2, and K-11 to also be a point on this production function? Why or why not? The combination q -30, L-2 and K-11 O A. cannot be a point because we assume production functions represent the short run O B. can be a point because we assume production functions exhibit diminishing returns. ° C. cannot be...
a. Suppose that a firm has the Cobb-Douglas production function = 12K0.75 0.25. Because this function exhibits returns to scale, the long-run average cost curve is , whereas the long-run total cost curve is upward-sloping, with slope. b. Now suppose that the firm's production function is = KL. Because this function exhibits returns to scale, the long-run average cost curve is upward-sloping , whereas the long-run total cost curve is upward-sloping, with slope. a. Suppose that a firm has the...
1. A production function is given by f(K, L) = L/2+ v K. Given this form, MPL = 1/2 and MPK-2 K (a) Are there constant returns to scale, decreasing returns to scale, or increasing returns to scale? (b) In the short run, capital is fixed at -4 while labor is variable. On the same graph, draw the 2. A production function is f(LK)-(L" + Ka)", where a > 0 and b > 0, For what values of a and...
1. Consider a firm that has the following CES production function: Q = f(L,K) = [aLP + bK°]!/p where p a. Derive the MRTS for this production function. Does this production function exhibit a diminishing MRTS? Justify using derivatives and in words. What does this imply about the shape of the corresponding isoquants? (10 points) b. What are the returns to scale for this production function? Show and explain. Explain what will happen to cost if the firm doubles its...
7. Assume that the long-run production function can be expressed as Q-SKL? Where Q is quantity of output, K is the quantity of capital and L is the quantity of labor. If capital is fixed at 10 units in the short run then the short-run production function is: Q=10KL b. Q=50KL? Q=10L? d. 0=50L Q=500KL 8. For a linear total cost function: a. MC will be downward sloping b. MC = AVC c. AVC is upward sloping and linear d....
Suppose that q 30, L 2, and K-10 is a point on the production function q=f(L, K) Is it posssible for q 30, L 2, and K-11 to also be a point on this production function? Why or why not? The combination q -30, L-2 and K-11 O A. cannot be a point because we assume production functions represent the short run O B. can be a point because we assume production functions exhibit diminishing returns. ° C. cannot be...
Most questions answered within 3 hours.
-
Individuals in a species of moth vary in wing color from white to
black, but all...
asked 10 minutes ago -
The following standards for variable manufacturing overhead have
been established for a company that makes only...
asked 22 minutes ago -
The United States government wanted to determine what proportion
of Americans approve of the current president,...
asked 36 minutes ago -
2-N stone is dropped from the top of a cliff. The stone hits the
ground 3...
asked 37 minutes ago -
Vitamins participate in metabolic reactions in their coenzyme
forms . Match the following reactions to the respective...
asked 39 minutes ago -
We have developed a new mobile device and wish to gain insight
into the price that...
asked 1 hour ago -
12.8 ml of a solution is run into an empty flask, from a buret.
The mass...
asked 53 minutes ago -
Using java:
Use the following starter code:
public class HandsOn01 {
public //// insert your code...
asked 52 minutes ago -
Two speakers are placed along a wall 3 m apart. They are in
phase and emitting...
asked 1 hour ago -
Determine the magnitude of the complex number z = 3 – j * 4
using the...
asked 57 minutes ago -
Why don’t we give poor people more cash welfare instead of
in-kind transfers like food stamps,...
asked 1 hour ago -
Two companies, A and B, decide to acquire asset worth $15
million. Company A decides to...
asked 1 hour ago