33- If an increase in the price of one good leads to a fall in the quantity demanded of other than these goods are complementry good A- True B- False
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please sir solve these 3 questions
33- If an increase in the
goods are complementry good
A- True
B- False
34- the production function is a purely technical relationship between input and output
A- True
B- False
35- marginal proudact is defined as the change in TP resulting from the employment of an additional
unit of a varibal factor:
A- True
B- False
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- ) Suppose there are two inputs in the production function-labor and capitaland that these two inputs are perfect substitutes. Suppose that the price of capital is 750 GHC per machine per week and that the weekly salary of each . worker is 300 GHC . i) Draw the isocost line ii) With the aid of a graph, explain the effect of a wage decrease on flrm-level employment and output holding initial cost ouday constant.Suppose a firm is producing some output level q1 using a combination of capital and labor for which the RTS (MPL/MPK) at this input combination is 1. Suppose further that the wage rate is $20 and the rental rate on capital is $10. Which of the following statements is correct? A. The firm can reduce its costs of producing q1 by using more labor and less capital B. The firm can reduce its costs of producing q1 by using more capital and less labor C. The firm is currently minimizing the costs of producing q1 D. Whether or not the firm is minimizing the costs of producing q1 is indeterminateCowles Foundationfor Research in Economicsat Yale UniversityCowles Foundation Discussion Paper No. 2021ARE WE APPROACHING AN ECONOMIC SINGULARITY?INFORMATION TECHNOLOGY AND THE FUTUREOF ECONOMIC GROWTHWilliam D. NordhausSeptember 2015An author index to the working papers in theCowles Foundation Discussion Paper Series is located at:http://cowles.yale.edu/This paper can be downloaded without charge from theSocial Science Research Network Electronic Paper Collection:http://ssrn.com/abstract=2658259Electronic copy available at: http://ssrn.com/abstract=2658259Are We Approaching an Economic Singularity?Information Technology and the Future of Economic GrowthWilliam D. Nordhaus1September 1, 2015AbstractWhat are the prospects for long-run economic growth? The presentstudy looks at a recently launched hypothesis, which I label Singularity.The idea here is that rapid growth in computation and artificialintelligence will cross some boundary or Singularity after whicheconomic growth will…
- Production function for firm is Ys=ln(Ld)Utility function is U(Yd, Ld)= Ys+ln(1-Ls)1) Write down maximization problem of firm and find labor demand curve2) Write down maximization problem of household and find labor supply curve3) Write down market clearing conditions4) Calculate equilibrium employment and real wage5) If the price is equal to $2, what would be the nominal wage in equilibriumFrom the following production functions 1. Q= a1H + a2L + a3H2 + a4 L2 + a5HL, where ai> 0 2. Q = aH@ Ly, where a, @, y > 0 a. Derive the equation of the relevant isoquant. b. Find out whether the production function is well behaved. c. Examine whether the isoquant is well behaved and therefore represents the behaviour of a rational production. d. Derive equation which describes MRTS of 9ne factor. e. For each equation examine whether the production is homogeneous and if so, what is the degree of homogeneity. Is the equation characterized by IRTS, DRTS or CRTS.Q1. Suppose we are given the constant returns-to-scale CES production function q = [k + l]1/ where k represents capital and l represents labora. a. Show that MPk = (q/k)1 and MPl = (q/l)1 . b. Show that RTS = (k/l)1 ; use this to show that elasticity of substitution between labor and capital= 1/(1 – ). c. Determine the output elasticities for k and l; and show that their sum equals 1.Note: Output elasticity measures the response of change in q to a change in any input. Elasticity of output wrt k is eq,k = %q/%k = (q/k)*(k/q) or (q/k)*(k/q) or lnq/lnkSimilarly for elasticity of output wrt l, eq,ld. Prove that q/l = (q/l) and hence that ln(q/l) = ln(q/l)
- Non-backward-bending labor supply curve. Consider an economy populated by 100 individuals who have identical preferences over consumption and leisure. In this economy the aggregate labor supply curve is upward-sloping. For simplicity, suppose that throughout this question that the labor tax rate is zero. a. For such a labor supply curve, how does the substitution effect compare with the income effect? b. Using indifference curves and budget constraints, show how such a labor supply curve arises.A. Explain how MP = decreasing within the Cobb - Douglas function ( explain the functions and their variables ) 2.45 2.65 B. The company Tres Monjitas faces the following production function : Q = L K and has the following prices of inputs : PL = $ 10 and PK = $ 20 . Estimate the Cobb - function Douglass (Get L relative to K).Consider an economy with production function given by Y = AK0:5L0:5 where A is the total factorproductivity (TFP), K is the capital stock and L is the labor input. For simplicity assume capital is xed and equal to 1. Assume A=100.a. Write the rm's problem of choosing labor demand. Derive the demand for labor as a functionof the real wage.b. Assume labor supply is inelastic and xed at L= 100. Find the equilibrium values of the wageand the employment level for this economy. Display graphically the labor supply and the labordemand curves. Carefully label your graph.c. Suppose the economy faces a positive productivity shock and TFP is now A=200. Displaygraphically the new labor demand function. What are the equilibrium values of employment andthe real wage?d. Compute the total output when A=100 and when A=200. What is the output's growth rate?Compare that growth rate with the growth rate in A. How does the growth rate of output percapita compares to the growth rate in A? Explain…
- Derive the price-setting curve . What does the equation for the PS curve tell us about the ability of firms to make supernormal profits?. Explain in words why the decision of firms about what price to set has implications for the real wage in the economy. Provide two different explanations for why the PS curve might be flat .It deals with the Production Function, Marginal Rate of Technical Subsition . Problem: The Production Function for a Product is given by q=10 K ^1/2 L^1/2 where K is capital and L is Labor and q is output . 1a. Find the Marginal Product of labor and the Marginal Product of Capital 1b. Find the Marginal Rate Of Technical Substitution between Labor and Capital 1c. Denote the wage of Labor by w and the renal of cpaital by r . What is thre cost of the minization condition for a firm . Show it digrammatically.A producer has the following technology.y= 6K^(1/2)L^(1/2) a) Prove formally that the production function exhibits constant returns to scale (use “λ” argument). b) Find analytically MPL and MPK. Is MPL increasing, decreasing, or constant inL? Is MPK increasing, decreasing, or constant in K? c) Short-run: Given stock of capital ̄K= 1 find labor demand (formula) of a competitive firm. Find equilibrium real wage rate if labor supply is given by Ls= 9 (one number). d) Assume again ̄K= 1 and that Ls= 9. The government adopts a real minimum wage of wmin/p=(3/2). Find labor demand (one number) and the unemployment rate (one number). Please depict the equilibrium on a graph with the real wage on the vertical axis and labor on the horizontal axis, indicating the equilibrium quantity of labor, wage, and unemployment, as well as the relevant curves. e) Find the cost function given prices of inputs wK= 4 and wL= 1 (formula). Plot the cost function on a graph, indicating the slope of the cost…