Homework Answers
Correct option is (4).
If both capital and labor stocks are given, then total output (which is a function of total stock of labor and capital) which depend on the total labor and total capital available.
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If K-K and L = I, then output is determined by: Not enough information is given....
Suppose output is determined by where A represents technology levels, K is capital, and L is...
Suppose output is determined by where A represents technology levels, K is capital, and L is labor. Suppose that A=10, K=100, and L=25. Demand for investment funds is given by where r is the interest rate. (Note: If r is 5% than r=.05) Consumers save more (ie consume less) when the interest rate is high. So consumption is given by The government consumes G=100. What is the level of output in this economy? What is the equilibrium level of the interest rate?...
Suppose the per-capita production function is given by y=\k, where kis capital per person and y is output per person....
Suppose the per-capita production function is given by y=\k, where kis capital per person and y is output per person. Suppose that the savings rate in this economy is 50% and capital depreciates at the rate of 25% a year. The steady-state capital-to-labor ratio is: k-1 k 2 k-4 cannot be determined from the above information.
Given production function Q=f(K, L) = 8KL + √L where K is capital and L is labor.
Given production function Q=f(K, L) = 8KL + √L where K is capital and L is labor. a. Find marginal product of labor and marginal product of capital.b. Define what is marginal rate of technical substitution, MRTS. Calculate the MRTS for the above case.c. When K = 10, L = 16, what is the total output? Sketch this isoquant function on a diagram where K is the vertical axis and L is the horizontal axis.
1. The production function for ACME WIDGETS is given by Q = 30 K^0.65 L^0.25 ,...
1. The production function for ACME WIDGETS is given by Q = 30 K^0.65 L^0.25 , where Q is the number of widgets ACME produces in a month, K is the number of units of capital input and L is the number of units of labor input ACME uses to produce their widgets. The price per unit of capital input is p K = $ 4 , 000 and the price per unit of labor input is p^L = $...
9. A firm uses capital and labor to produce a single output good. The production function...
9. A firm uses capital and labor to produce a single output good. The production function is given by F(K,L)=K^0.5L, where K is the amount of capital and L is the amount of labor employed by the firm. The unit prices of capital and labor are given by, respectively r=$5 and w=$6. Based on this information, characterize the optimal (output maximizing) allocation of inputs given that the firm decided to limit its total cost to $12,000. Illustrate your solution graphically:...
If Q is total real output, K is capital in use, L is labor employed, an...
If Q is total real output, K is capital in use, L is labor employed, an increase in the productivity of labor would imply a(n):? increase in Q/L.? increase in L/K.? decrease in (Q + K)/L.? decrease in Q/K.? ?increase in K/L. Which of the following is true of the agricultural sector in developing countries?? ?It causes a rapid growth in the economy's national income. ?It relies heavily on technology. ?A very small percentage of labor force is employed in...
consider an industry that uses capital, K and labor, L to produce output, X, according to...
consider an industry that uses capital, K and labor, L to produce output, X, according to a Cobb-Douglas production function: x=K L where 0 <X<1 is the share parameter for capital and 0<B,1 is the share parameter for labor. Denote the rental price of capital by r and the wage by w. Determine the capital to labor ratio (K/L) wh9ich minimizes the cost of producing a fixed amount of output, X. Under what conditions does optimal ratio of capital to...
17. Output for a simple production process is given by Q = K2L, where K denotes...
17. Output for a simple production process is given by Q = K2L, where K denotes capital, and L denotes labor. The price of capital is $30 per unit and capital is fixed at 3 units in the short run. The price of labor is $15 per unit. a. The total cost of producing 180 units of output is _____. b. The variable cost of producing 180 units of output is ____.
d. Assume that the aggregate production function is given by: where Y is aggregate output, K is capital, L is the number of workers in the economy and E is the state of technology. Further assume...
d. Assume that the aggregate production function is given by: where Y is aggregate output, K is capital, L is the number of workers in the economy and E is the state of technology. Further assume that capital depreciates at a rate of δ, the rate of technological progress is g, the population is growing at a rate of n and the saving rate is s. I5 marks] i. Determine the scale of production? Suppose capital is increased by a...
A firm production function is given by q(l,k) = l0.5·k0.5, where q is number of units...
A firm production function is given by q(l,k) = l0.5·k0.5, where q is number of units of output produced, l the number of units of labor input used and k the number of units of capital input used. In the short-run the firm’s amount of capital is fixed at k1 = 100. When l = 25, the firm’s marginal product of labor is [MPl].
Suppose the per-capita production function is given by y=\k, where kis capital per person and y is output per person. Suppose that the savings rate in this economy is 50% and capital depreciates at the rate of 25% a year. The steady-state capital-to-labor ratio is: k-1 k 2 k-4 cannot be determined from the above information.
d. Assume that the aggregate production function is given by: where Y is aggregate output, K is capital, L is the number of workers in the economy and E is the state of technology. Further assume that capital depreciates at a rate of δ, the rate of technological progress is g, the population is growing at a rate of n and the saving rate is s. I5 marks] i. Determine the scale of production? Suppose capital is increased by a...
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