(1) Suppose the production function for widgets is given by q = kl-0.8k -0.212 where q is the annual quantity of widgets produced, k is the annual capital input and 1 is the annual labor input. (a) Suppose k=10; Find the average productivity of labor. At what level of labor input does the average productivity reach a maximum? (b) Suppose k-=10; Find the marginal productivity of labor, At what level of labor input does the marginal productivity reach a maximum? Is the average product equal to the marginal product at the point where average product reaches its maximum? Please show it.

(1) Suppose the production function for widgets is given by q = kl-0.8k -0.212 where q is the annual quantity of widgets produced, k is the annual capital input and 1 is the annual labor input. (a) Suppose k=10; Find the average productivity of labor. At what level of labor input does the average productivity reach a maximum? (b) Suppose k-=10; Find the marginal productivity of labor, At what level of labor input does the marginal productivity reach a maximum? Is the average product equal to the marginal product at the point where average product reaches its maximum? Please show it.

Microeconomic Theory

12th Edition

ISBN:9781337517942

Author:NICHOLSON

Publisher:NICHOLSON

Chapter9: Production Functions

Section: Chapter Questions

Problem 9.2P

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