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6. From the production function given in the following table, draw a figure showing (a) the...
A. L=3; K=6 B. L=10; K=6 C. L=7; K=9 D. L=8; K=7 The graph below shows...
A. L=3; K=6
B. L=10; K=6
C. L=7; K=9
D. L=8; K=7
The graph below shows a firm's isoquants and isocosts. The firm is initially producing Q=20 with the cost minimizing combination of K and L, where Q is output, Kis capital and L is labor. Suppose the owner decides to expand production to Q=40. However, he signed a lease on the capital necessary to produce Q=20, which he cannot get out of in the short run. In order to...
13) Does the production function of Table 7-1 show constant, increasing or decreasing returns to scale...
13) Does the production function of Table 7-1 show constant, increasing or decreasing returns to scale if the firm increases the quantity of labor and capital used from (a) 2L and 2K to 4L and 4K? (b) 2L and 4K to 3L and 6k? TABLE 7-1 Production Functiion with two inputs Capital (K) 6 10 24 31 36 40 39 5 12 28 3640 42 40 4 12 28 36 40 40 36 Output (Q) 3 10 23 33 36...
4. Consider the production functions given below: a. Suppose that the production function faced by a...
4. Consider the production functions given below: a. Suppose that the production function faced by a milk producer is given by Q = 40.5 20.5 = 4VK VL, where MPx = 2K-0.5 20.5 = 2 and MP, = 2 K0.5L-05 = 2 * i. Do both labor and capital display diminishing marginal products in the short run? ii. Find the marginal rate of technical substitution for this production function. (Hint: The MRTS = 1) iii. Does this production function display...
The graph below shows a firm's isoquants and isocosts. The firm is initially producing Q-20 with...
The graph below shows a firm's isoquants and isocosts. The firm is initially producing Q-20 with the cost minimizing combination of K and L, where Q is output, Kis capital and Lis labor. Suppose the owner decides to expand production to Q=40. However, he signed a lease on the capital necessary to produce Q=20, which he cannot get out of in the short run. Are the short run total costs of producing Q=40 smaller or larger than the long run...
The graph below shows a firm's isoquants and isocosts. The firm is initially producing Q-20 with...
The graph below shows a firm's isoquants and isocosts. The firm is initially producing Q-20 with the cost minimizing combination of K and L, where Q is output, Kis capital and Lis labor. Suppose the owner decides to expand production to Q=40. However, he signed a lease on the capital necessary to produce Q=20, which he cannot get out of in the short run. Are the short run total costs of producing Q-40 smaller or larger than the long run...
The graph below shows a firm's isoquants and isocosts. The firm is initially producing Q=20 with...
The graph below shows a firm's isoquants and isocosts. The firm is initially producing Q=20 with the cost minimizing combination of K and L, where Q is output, Kis capital and L is labor. Suppose the owner decides to expand production to Q=40. However, he signed a lease on the capital necessary to produce Q=20, which he cannot get out of in the short run. Are the short run total costs of producing Q=40 smaller or larger than the long...
8. Suppose that the following graph shows a few of the isoquants for a firm's production...
8. Suppose that the following graph shows a few of the isoquants for a firm's production function for producing park benches. The firm's production function is Q = 20KVL. Suppose that the firm's goal is to produce Q= 160 in the cost minimizing way. The cost of a unit of capital (K) is $32 (r=$32) and the cost of a unit of labor is $32 (w=$32). a. Show the firm's cost minimizing isocost on the graph when the firm is...
1. The table below shows the levels of output a firm is capable of producing using...
1. The table below shows the levels of output a firm is capable of producing using different combinations of labor (L) and capital (K). Units of Labor 10 14 17 20 10 12 12 16 19 15 10 16 19 25 Use this information to draw a graph plotting simple, approximate isoquants for the following levels of output: 10. 14, and 22. 2. A. Draw a set of isoquants for a firm experiencing increasing returns to scale. B. Show and/or...
Using the production function Q = ( and output levels of Q=2, Q=4, Q=6 A). Suppose...
Using the production function Q = (
and output levels of Q=2, Q=4, Q=6
A). Suppose the price of L and K is $3/hr. On a graph show
isocost lines corresponding to total costs of $12, $24, and $36.
Using isoquants and isocost lines, locate three points on the
expansion path and draw the expansion path. Show your
calculations.
B). Using the three points on the expansion path, calculate the
firm's long run total and average costs at each of...
1. Imagine a firm has the following short-run production function: q=f(L,K) = K L – L?...
1. Imagine a firm has the following short-run production function: q=f(L,K) = K L – L? Assume K = 25. a. Fill in the following table. (First, find the total output from the production function, then find the marginal product by dividing the change in total output by change in labor.) Capital MPL Labor 7 Total Output 126 APL 18 25 12 25 25 25 25 25 10 11 12 13 14 15 25 25 25 b. How many units...
A. L=3; K=6
B. L=10; K=6
C. L=7; K=9
D. L=8; K=7
The graph below shows a firm's isoquants and isocosts. The firm is initially producing Q=20 with the cost minimizing combination of K and L, where Q is output, Kis capital and L is labor. Suppose the owner decides to expand production to Q=40. However, he signed a lease on the capital necessary to produce Q=20, which he cannot get out of in the short run. In order to...
13) Does the production function of Table 7-1 show constant, increasing or decreasing returns to scale if the firm increases the quantity of labor and capital used from (a) 2L and 2K to 4L and 4K? (b) 2L and 4K to 3L and 6k? TABLE 7-1 Production Functiion with two inputs Capital (K) 6 10 24 31 36 40 39 5 12 28 3640 42 40 4 12 28 36 40 40 36 Output (Q) 3 10 23 33 36...
4. Consider the production functions given below: a. Suppose that the production function faced by a milk producer is given by Q = 40.5 20.5 = 4VK VL, where MPx = 2K-0.5 20.5 = 2 and MP, = 2 K0.5L-05 = 2 * i. Do both labor and capital display diminishing marginal products in the short run? ii. Find the marginal rate of technical substitution for this production function. (Hint: The MRTS = 1) iii. Does this production function display...
The graph below shows a firm's isoquants and isocosts. The firm is initially producing Q-20 with the cost minimizing combination of K and L, where Q is output, Kis capital and Lis labor. Suppose the owner decides to expand production to Q=40. However, he signed a lease on the capital necessary to produce Q=20, which he cannot get out of in the short run. Are the short run total costs of producing Q=40 smaller or larger than the long run...
The graph below shows a firm's isoquants and isocosts. The firm is initially producing Q-20 with the cost minimizing combination of K and L, where Q is output, Kis capital and Lis labor. Suppose the owner decides to expand production to Q=40. However, he signed a lease on the capital necessary to produce Q=20, which he cannot get out of in the short run. Are the short run total costs of producing Q-40 smaller or larger than the long run...
The graph below shows a firm's isoquants and isocosts. The firm is initially producing Q=20 with the cost minimizing combination of K and L, where Q is output, Kis capital and L is labor. Suppose the owner decides to expand production to Q=40. However, he signed a lease on the capital necessary to produce Q=20, which he cannot get out of in the short run. Are the short run total costs of producing Q=40 smaller or larger than the long...
8. Suppose that the following graph shows a few of the isoquants for a firm's production function for producing park benches. The firm's production function is Q = 20KVL. Suppose that the firm's goal is to produce Q= 160 in the cost minimizing way. The cost of a unit of capital (K) is $32 (r=$32) and the cost of a unit of labor is $32 (w=$32). a. Show the firm's cost minimizing isocost on the graph when the firm is...
1. The table below shows the levels of output a firm is capable of producing using different combinations of labor (L) and capital (K). Units of Labor 10 14 17 20 10 12 12 16 19 15 10 16 19 25 Use this information to draw a graph plotting simple, approximate isoquants for the following levels of output: 10. 14, and 22. 2. A. Draw a set of isoquants for a firm experiencing increasing returns to scale. B. Show and/or...
Using the production function Q = (
and output levels of Q=2, Q=4, Q=6
A). Suppose the price of L and K is $3/hr. On a graph show
isocost lines corresponding to total costs of $12, $24, and $36.
Using isoquants and isocost lines, locate three points on the
expansion path and draw the expansion path. Show your
calculations.
B). Using the three points on the expansion path, calculate the
firm's long run total and average costs at each of...
1. Imagine a firm has the following short-run production function: q=f(L,K) = K L – L? Assume K = 25. a. Fill in the following table. (First, find the total output from the production function, then find the marginal product by dividing the change in total output by change in labor.) Capital MPL Labor 7 Total Output 126 APL 18 25 12 25 25 25 25 25 10 11 12 13 14 15 25 25 25 b. How many units...
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