Suppose we now care about the long run decisions of a firm that has a production...
Suppose we now care about the long run decisions of a firm that has a production function of the form q = 4L 1/2 + K
Assume that, at the beginning when w0 = 1 and r = 0.5, the firm chose to produce q0 = 20 units of output. Then, the wage increased to w1 = 2 and in consequence the firm chose to produce q1 = 10 units of output.
(a) Calculate the optimal choices of labor and capital after the wage change.
(b) Draw the old and new isocosts lines
(c) Calculate the scale effect
(d) Calculate the substitution effect
(e) Calculate the elasticity of substitution
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Suppose we now care about the long run decisions of a firm that
has a production...
[Short-Run Production] Suppose that a firm is producing in the short run with output given by:...
[Short-Run Production] Suppose that a firm is producing in the short run with output given by: Q = 200.5L – 2.5L2, The firm hires labor at a wage of $25 per hour and sells the good in a competitive market at P = $50 per unit. Find the firm’s optimal use of labor and associated level of output. (For extra practice, what is the firm’s associated profit?) I have already finished and went to check my work on Chegg and...
Problem #3: Long-Run Labor Demand and Factor Substitutability Suppose there are two inputs in the production...
Problem #3: Long-Run Labor Demand and Factor Substitutability Suppose there are two inputs in the production function, labor (L) and capital (K), which can be combined to produce Y units of output according to the following production function: 7. Suppose the firm can choose whatever combination of capital (K) and labor (L) it wants to produce 600 units. Suppose the price of capital is S1,000 per machine per week. What combination of inputs (K and L) will the firm use...
Problem 4: A firm has the following production function: Xi , X2)=X1 , X2 A) Does this firm's tec...
Problem 4: A firm has the following production function: Xi , X2)=X1 , X2 A) Does this firm's technology exhibit constant, increasing, or decreasing returns to scale? B) What is the firm's Technical Rate of Substitution? What is the optimality condition that determines the firm's optimal level of inputs? C) Is the marginal product of input 1 increasing, constant, or decreasing in x1. Is the marginal product of input 2 increasing, constant, or decreasing in x2? D) Suppose the firm...
Problem 3: A firm has the following production function: f(x1,x2) = x7/3x4/3 A) Does this firm's...
Problem 3: A firm has the following production function: f(x1,x2) = x7/3x4/3 A) Does this firm's technology exhibit constant, increasing, or decreasing returns to scale? B) What is the firm's Technical Rate of Substitution? What is the optimality condition that determines the firm's optimal level of inputs? C) Is the marginal product of input 1 increasing, constant, or decreasing in X1. Is the marginal product of input 2 increasing, constant, or decreasing in xz? D) Suppose the firm wants to...
Problem #3: Long-Run Labor Demand and Factor Substitutability Suppose there are two inputs in the production...
Problem #3: Long-Run Labor Demand and Factor Substitutability Suppose there are two inputs in the production function, labor (L) and capital (K), which carn be combined to produce Y units of out put according to the following production function: Y-30K+10L The firm wants to produce 600 units of out put 1. Draw the isoquant that corresponds to that level of production (600 units) in a graph that has L on the horizontal axis and K on the vertical axis 2....
9. Suppose the firm's production function is given by f(K,L) = min (Kº,L"} (a) For what values of a will the firm e...
9. Suppose the firm's production function is given by f(K,L) = min (Kº,L"} (a) For what values of a will the firm exhibit decreasing returns to scale? Constant returns to scale? Increasing returns to scale? (b) Derive the long-run cost function and the optimal input choices. (c) Suppose the capital is fixed at K = 10,000 and a = 1. Assuming that the firm wants to produce less than 100 units, derive 10. Consider the production function: f(K,L)=KLI. Let w...
2. Suppose the firm has the one variable production function Q=L?. Assume that the wage rate...
2. Suppose the firm has the one variable production function Q=L?. Assume that the wage rate is w= 20 and that the firm has fixed costs of 10. Finally, assume that the firm is a price taker and the market price is 2. a) Show that this production function exhibits increasing returns to scale. Show that the marginal product of labor is increasing. Illustrate the production function. Is it convex, concave or neither? b) Find the variable and total cost...
please complete the graph also..thank you! 7. Long-run cost Suppose Ernie is opening a new restaurant...
please complete the graph also..thank you!
7. Long-run cost Suppose Ernie is opening a new restaurant that will produce pizzas using a combination of workers (L) and ovens (K). Ernie knows from experience that the total number of pizzas he can produce in an hour is given by the function q= 10K0.5 0.5 . Ernie can rent ovens for an hourly cost of $10 and must pay his employees $10 per hour. ($10 + K) * ($10 + L) Therefore,...
I need Summary of this Paper i dont need long summary i need What methodology they used , what is the purpose of this p...
I need Summary of this Paper i dont need long summary i need
What methodology they used , what is the purpose of this paper and
some conclusions and contributes of this paper. I need this for my
Finishing Project so i need this ASAP please ( IN 1-2-3 HOURS
PLEASE !!!)
Budgetary Policy and Economic Growth Errol D'Souza The share of capital expenditures in government expenditures has been slipping and the tax reforms have not yet improved the income...
Problem #3: Long-Run Labor Demand and Factor Substitutability Suppose there are two inputs in the production function, labor (L) and capital (K), which can be combined to produce Y units of output according to the following production function: 7. Suppose the firm can choose whatever combination of capital (K) and labor (L) it wants to produce 600 units. Suppose the price of capital is S1,000 per machine per week. What combination of inputs (K and L) will the firm use...
Problem 4: A firm has the following production function: Xi , X2)=X1 , X2 A) Does this firm's technology exhibit constant, increasing, or decreasing returns to scale? B) What is the firm's Technical Rate of Substitution? What is the optimality condition that determines the firm's optimal level of inputs? C) Is the marginal product of input 1 increasing, constant, or decreasing in x1. Is the marginal product of input 2 increasing, constant, or decreasing in x2? D) Suppose the firm...
Problem 3: A firm has the following production function: f(x1,x2) = x7/3x4/3 A) Does this firm's technology exhibit constant, increasing, or decreasing returns to scale? B) What is the firm's Technical Rate of Substitution? What is the optimality condition that determines the firm's optimal level of inputs? C) Is the marginal product of input 1 increasing, constant, or decreasing in X1. Is the marginal product of input 2 increasing, constant, or decreasing in xz? D) Suppose the firm wants to...
Problem #3: Long-Run Labor Demand and Factor Substitutability Suppose there are two inputs in the production function, labor (L) and capital (K), which carn be combined to produce Y units of out put according to the following production function: Y-30K+10L The firm wants to produce 600 units of out put 1. Draw the isoquant that corresponds to that level of production (600 units) in a graph that has L on the horizontal axis and K on the vertical axis 2....
9. Suppose the firm's production function is given by f(K,L) = min (Kº,L"} (a) For what values of a will the firm exhibit decreasing returns to scale? Constant returns to scale? Increasing returns to scale? (b) Derive the long-run cost function and the optimal input choices. (c) Suppose the capital is fixed at K = 10,000 and a = 1. Assuming that the firm wants to produce less than 100 units, derive 10. Consider the production function: f(K,L)=KLI. Let w...
2. Suppose the firm has the one variable production function Q=L?. Assume that the wage rate is w= 20 and that the firm has fixed costs of 10. Finally, assume that the firm is a price taker and the market price is 2. a) Show that this production function exhibits increasing returns to scale. Show that the marginal product of labor is increasing. Illustrate the production function. Is it convex, concave or neither? b) Find the variable and total cost...
please complete the graph also..thank you!
7. Long-run cost Suppose Ernie is opening a new restaurant that will produce pizzas using a combination of workers (L) and ovens (K). Ernie knows from experience that the total number of pizzas he can produce in an hour is given by the function q= 10K0.5 0.5 . Ernie can rent ovens for an hourly cost of $10 and must pay his employees $10 per hour. ($10 + K) * ($10 + L) Therefore,...
I need Summary of this Paper i dont need long summary i need
What methodology they used , what is the purpose of this paper and
some conclusions and contributes of this paper. I need this for my
Finishing Project so i need this ASAP please ( IN 1-2-3 HOURS
PLEASE !!!)
Budgetary Policy and Economic Growth Errol D'Souza The share of capital expenditures in government expenditures has been slipping and the tax reforms have not yet improved the income...
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