Suppose the hourly wage is $10 and the price of each unit of capital is $25....

Question

Question

Suppose the hourly wage is $10 and the price of each unit of capital is $25. The price of output is constant at $50 per unit. The production function is f(E,K) = E^1/2K^1/2

If the current capital stock is fixed at 1600 units, how much labor should the firm employ in the short run?

Answer 1

Answer #1

Answer 2

Similar Homework Help Questions

6. Suppose the hourly wage is $40, the price of each unit of capital is $50,...

6. Suppose the hourly wage is $40, the price of each unit of capital is $50, and the price of output is $100 per unit. Assume that the firm cannot affect any of these prices. The production function of the firm is so that the marginal product of labor is MPE 2E a. If the current capital stock is fixed at 1,600 units, how many hours of labor should the firm hire in the short run (i.e., what should E...
Suppose the hourly wage is $40, the price of each unit of capital is $50, and...

Suppose the hourly wage is $40, the price of each unit of capital is $50, and the price of output is $100 per unit. Assume that the firm cannot affect any of these prices The production function of the firm is 6. so that the marginal product of labor is MPE 2E a If the current capital stock is fixed at 1,600 units, how many hours of labor should the firm hire in the short run (ie., what should &...
6. Suppose the hourly wage is $40, the price of each unit of capital is $50,...

6. Suppose the hourly wage is $40, the price of each unit of capital is $50, and the price of output is S100 per unit. Assume that the firm cannot affect any of these prices. The production function of the firm is so that the marginal product of labor is If the current capital stock is fixed at 1,600 units, how many hours of labor should the firm hire in the short run (i.e., what should E be)? How much...

Suppose the hourly wage is $10, the price of each unit of capital is $20, and...

Suppose the hourly wage is $10, the price of each unit of capital is $20, and the price of output is $60 per unit. Assume that the firm cannot affect any of these prices. The production function of the firm is 7. a. Find the MPE (4 pts) b. If the firm is maximizing profits, what must the ratio of MPE to MPK be? What must the ratio of E to K be? Hint MPK-dQ/dK 1/3K23 E (2 points) c....
7. Suppose the hourly wage is $10, the price of each unit of capital is $20,...

7. Suppose the hourly wage is $10, the price of each unit of capital is $20, and the price of output is $60 per unit. Assume that the firm cannot affect any of these prices. The production function of the firm is a. Find the MPE (4 pts) b. If the firm is maximizing profits, what must the ratio of MPE to MPK be? What must the ratio of E to K be? Hint MPK-dQ/dK 1/3K 23 E1S ( points...
7. Suppose the hourly wage is $10, the price of each unit of capital is $20,...

7. Suppose the hourly wage is $10, the price of each unit of capital is $20, and the price of output is $60 per unit. Assume that the firm cannot affect any of these prices. The production function of the firm is a. Find the MPE (4 pts) b. If the firm is maximizing profits, what must the ratio of MPE to MPK be? What must the ratio of E to K be? Hint MPK-dQ/dK- 1/3K 23 E13 (2 points)...

7. Suppose the hourly wage is S10, the price of each unit of capital is S20,...

7. Suppose the hourly wage is S10, the price of each unit of capital is S20, and the price of output is S60 per unit. Assume that the firm cannot affect any of these prices. The production function of the firm is a. Find the MPE (4 pts) b. If the firm is maximizing profits, what must the ratio of MPE to MPK be? What must the ratio of E to K be? Hint MPK-dQ/dK 1/3K-23E13 (2 points) c. Find...
2. Mike's Tires produces tires according to the following production function: q E /2K1/, Suppose the...

2. Mike's Tires produces tires according to the following production function: q E /2K1/, Suppose the hourly wage is $10 and the rental rate of capital is $20. The price of a tire is $50 a. In the short run, the capital stock is fixed at Ko 1600. How much employment should Mike's Tires choose in the short run? b. What is Mike's Tires profit in the short runi?
) A firm produces output that can be sold at a price of $10. The Cobb-Douglas...

) A firm produces output that can be sold at a price of $10. The Cobb-Douglas production function is given by Q = F(K,L) = K½ L½ If capital is fixed at 1 unit in the short run, how much labor should the firm employ to maximize profits if the wage rate is $2?

* A firm produces output that can be sold at a price of $10. The Cobb-Douglas...

* A firm produces output that can be sold at a price of $10. The Cobb-Douglas production function is given by Q = F(K,L) = K½ L½ If capital is fixed at 1 unit in the short run, how much labor should the firm employ to maximize profits if the wage rate is $2? * Given the Cobb-Douglas production function for Mabel’s factory Q = (L0.4) * (K0.7) a) Based on the function above, does Mabel’s factory experiencing economies...