You are given the following short-run production function for Superfast Hairdryers, Inc., where X is material...
You are given the following short-run production function for Superfast Hairdryers, Inc., where X is material inputs, and Q is output. Q = 10X - 0.25X2 Suppose the hair dryers are sold for $10 per unit to K-Mart. Also assume that the firm can obtain as much of the variable materials, input (X), as it needs at $20 per unit.
i) Determine the Marginal Revenue Product (MRP) of materials.
ii) Determine the Marginal Cost (MC) function.
iii) Determine the optimal value of X, given the objective, is to maximise profit.
iv) If the price of hair dryers were to rise, what happens to the optimal values of X employed to produce the hair dryers?
v) If the quantity of capital were to rise, what would happen to the Marginal Product (MP) of materials?
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You are given the following short-run production function for
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