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c. Using the firm's information shown below answer the followin Q = f(KL) = 10KL r...
(20 points) A firm's production function is q = 10.5K0.5, so that MPL = 0.5 0.5...
(20 points) A firm's production function is q = 10.5K0.5, so that MPL = 0.5 0.5 40.5 20.5 and MPK = 0.5 0.5 10.5 k. Labor (L) costs w = 1, and capital (K) costs r = 4. a. (5 points) Solve for the long run optimal amount of labor (L') and capital (K*) if the firm wants to produce exactly 96 units of output. b. (5 points) What is the firm's long run total cost (in dollars) of producing...
Suppose a firm's production function is Q = (KL)0.5. In the short run, this firm's capital stock ...
Suppose a firm's production function is Q = (KL)0.5. In the short run, this firm's capital stock is fixed at 100. Calculate the firm's short run total cost curve if w = 5 and v = 5. It can be shown (using calculus) that this firm's short run marginal costs are .1Q. In order to maximize its profits, how much would the firm choose to produce if the market price of its output was $5, $10, or $20. For each...
2) (4 points) Suppose that a firm is producing in the short run using a combination...
2) (4 points) Suppose that a firm is producing in the short run using a combination of labor and capital. At their current point of production, the MPL = 100, MPK = 6000, w = $25 and r = $2000. In the long run, is the firm minimizing costs? If not, how should they change around their use of K and L to minimize costs while producing the same quantity? Discuss.
A firm produces gizmos according to the production function Q=10KL, where is the quantity of gismos...
A firm produces gizmos according to the production function Q=10KL, where is the quantity of gismos produced, K is the quantity of capital rented and L is the quantity of labour hired. The manager has been given a production target: Produce 9,000 gizmos per day. He is informed that the daily rental price of capital is $400 per unit and the wage rate is $200 per day. a) Currently, the firm has 10 units of capital. How many workers should...
A firm produces gizmos according to the production function Q =10KL , where Q is the...
A firm produces gizmos according to the production function Q =10KL , where Q is the quantity of gismos produced, K is the quantity of capital rented and L is the quantity of labour hired. The manager has been given a production target: Produce 9,000 gizmos per day. He is informed that the daily rental price of capital is $400 per unit and the wage rate is $200 per day. a) Currently, the firm has 10 units of capital. How...
3. Suppose a firm has the production function Q = 50 KL 1) If the wage...
3. Suppose a firm has the production function Q = 50 KL 1) If the wage rate is $10 per unit of labor and the rental rate of capital is $5 per unit of capital, how much capital and labor should the firm employ in the long run to minimize the cost of producing 40,000 units? 2) Using the solution in part 1), what will the firm’s long-run total cost be?
does this involve langragian method using CES production function? please solve as the answer posted isn't...
does this involve langragian method using CES production
function? please solve as the answer posted isn't
understandable.
A firm producing hockey sticks has a production function given by q=2 ki, In the short run, the firm's amount of capital equipment is fixed at k = 100. The rental rate for kis y=$1, and the wage rate for l is w = $4. a. Calculate the firm's short-run total cost curve. Calculate the short-run average cost curve. b. What is the...
A firm has the production function Q= 4LK. The marginal products are given by MPL =...
A firm has the production function Q= 4LK. The marginal products are given by MPL = 4K and MPK= 4L. Suppose that the prices of labour and capital are given by w and r. Solve for the quantities of L and K that minimize the cost of producing Q units of output. Provide an expression for the long run total cost function. What returns to scale are exhibited by this production function? What economies of scale are exhibited? Show the...
5. A firm produces widgets with production function: q-2vKL. In the short run, the firm's amount...
5. A firm produces widgets with production function: q-2vKL. In the short run, the firm's amount of capital is fixed at K = 100. The rental rate is v = 1 and the wage for L is w= 4. (a) Find the firm's short-run total cost curve (SRTC), short-run average cost curve (SRAC), and the short-run marginal cost (SMC) function. (b) Graph the firm's SAC and SMC using the following levels of production: q 25 and q= 100. (c) Find...
3. Suppose the firm is producing where MPL / w > MPK / r. (a) What...
3. Suppose the firm is producing where MPL / w > MPK / r. (a) What will it do to reduce cost but maintain the same output? illustrate and prove. (4 marks) Plot the firm's conditional demand curves for labour in both the short run and the long run. Explain. (6 marks)
(20 points) A firm's production function is q = 10.5K0.5, so that MPL = 0.5 0.5 40.5 20.5 and MPK = 0.5 0.5 10.5 k. Labor (L) costs w = 1, and capital (K) costs r = 4. a. (5 points) Solve for the long run optimal amount of labor (L') and capital (K*) if the firm wants to produce exactly 96 units of output. b. (5 points) What is the firm's long run total cost (in dollars) of producing...
2) (4 points) Suppose that a firm is producing in the short run using a combination of labor and capital. At their current point of production, the MPL = 100, MPK = 6000, w = $25 and r = $2000. In the long run, is the firm minimizing costs? If not, how should they change around their use of K and L to minimize costs while producing the same quantity? Discuss.
A firm produces gizmos according to the production function Q=10KL, where is the quantity of gismos produced, K is the quantity of capital rented and L is the quantity of labour hired. The manager has been given a production target: Produce 9,000 gizmos per day. He is informed that the daily rental price of capital is $400 per unit and the wage rate is $200 per day. a) Currently, the firm has 10 units of capital. How many workers should...
does this involve langragian method using CES production
function? please solve as the answer posted isn't
understandable.
A firm producing hockey sticks has a production function given by q=2 ki, In the short run, the firm's amount of capital equipment is fixed at k = 100. The rental rate for kis y=$1, and the wage rate for l is w = $4. a. Calculate the firm's short-run total cost curve. Calculate the short-run average cost curve. b. What is the...
5. A firm produces widgets with production function: q-2vKL. In the short run, the firm's amount of capital is fixed at K = 100. The rental rate is v = 1 and the wage for L is w= 4. (a) Find the firm's short-run total cost curve (SRTC), short-run average cost curve (SRAC), and the short-run marginal cost (SMC) function. (b) Graph the firm's SAC and SMC using the following levels of production: q 25 and q= 100. (c) Find...
3. Suppose the firm is producing where MPL / w > MPK / r. (a) What will it do to reduce cost but maintain the same output? illustrate and prove. (4 marks) Plot the firm's conditional demand curves for labour in both the short run and the long run. Explain. (6 marks)
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