A firm can manufacture a product according to the production function:Q=F(K,L)=K^(3/4) L^(1/4).a.Calculate the average product of labour, AP_L, when the level of capital is fixed at 81 units and the firm uses 16 units of labour. How does the average product of labour change when the firm uses 256 units of labour? b.Find an expression for the marginal product of labour, MP_L, when the amount of capital is fixed at 81 units. Then, calculate the marginal product of labour for 16 and 81 units of labour. c.Suppose capital is fixed at 81 units. If the firm can sell its output at a price of $200 per unit and can hire labour at $50 per unit, how many units of labour should the firm hire in order to maximize profits?
A firm can manufacture a product according to the production function:
Q=F(K,L)=K^(3/4) L^(1/4).
a.Calculate the average product of labour, AP_L, when the level of capital is fixed at 81 units and the firm uses 16 units of labour. How does the average product of labour change when the firm uses 256 units of labour?
b.Find an expression for the marginal product of labour, MP_L, when the amount of capital is fixed at 81 units. Then, calculate the marginal product of labour for 16 and 81 units of labour.
c.Suppose capital is fixed at 81 units. If the firm can sell its output at a price of $200 per unit and can hire labour at $50 per unit, how many units of labour should the firm hire in order to maximize profits?
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