Assume: PQ = $2.00 PL = $2.00 &n
Assume: PQ = $2.00 PL = $2.00 PK = $4.00
K MPK MP/PK MRP/PK L MPL MP/PL MRP/PL
1 28 7 14 1 15 5 10
2 24 6 12 2 12 4 8
3 20 5 10 3 9 3 6
4 12 4 8 4 6 2 4
5 8 2 4 5 3 1 2
6 4 1 2 6 1 0.5 1
7 2 0.5 1 7 0.5 0.25 0.5
8 1 0.25 0.5 8 0.25 0.13 0.26
9 0.5 0.125 0.25 9 0.125 0.06 0.12
The least cost combination of capital and labor to produce 87 units of output.
| K=7 and L=7 |
| K=2 and L=5 |
| K=1 and L=1 |
| K=3 and L=1 |
Homework Answers
K = 7 and L = 7
(Least cost combination is that where MP/PK = MP/PL. This occurs when L = K = 7 as MP/PK = MP/PL = 0.5)
PK $4.00 Po-$2.00 PL-$2.00 Assume: K MPK MP/PK MRP/PK MRP/PL L MPL MP/PL 1 28 7...
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Pk $4.00 PL = $2.00 Assume:P $2.00 10 1 15 5 1 28 2 24 6 12 3 20 5 10 4 12 48 7 1 8 2 12 4 4 6 10.5 0.5 0.250.5 7 2 0.5 8 1 0.25 0.5 9 0.5 0.125 0.25 The least cost combination of capital and labor to produce 87 units of output. 0.25 0.13 0.26 8 0.12 90.125 0.06
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Manufacturers.inc has the following production function that represents the available tech- nology to mix capital (K) and labor (L) (their only two inputs): 9(L, K) 3D L'3К?З = in the short run, the firm has a fixed level of capital K = 8 1) Fill the following table. MP. АPL 0 1 3 4 7 9 10 2) Graph total production, M P, and AP according to...
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