1a) A firm’s estimated long-run total cost function is LRTC = 160Q - .6Q2 + .002Q3. Suppose the firm is producing 100 units of output. The cost elasticity is ____ You can use Excel spreadsheet or otherwise to answer this question.b) A research study published in Social Science Medicine, “Production Functions for General Hospitals,” estimated the following general hospital production function in the Netherlands: Q = 5*Staff.34*Beds.64*Drugs.04*Specialists.02, where Q is a measure used by the authors for patient care. Suppose a hospital currently utilizes the following inputs: Staff =20, Beds = 120, Drugs = 60, Specialists =10. Use a spreadsheet to find the following or otherwise. If the hospital increases its specialists by one (1), that is, employs an 11th specialist, the increase in Q (marginal product) will be:c) A study published in Social Science Medicine, “Production Functions for General Hospitals,” estimated the following general hospital production function: Q = 5*Staff.34*Beds.64*Drugs.04*Specialits.02, where Q is a measure used by the authors for patient care. If we increase all inputs by 1%, the percentage change in Q will be:

Cost elasticity shows the degree of response to a change in output due to a change in cost. Given…

Answered: A firm’s estimated long-run total cost…

Microeconomic Theory

12th Edition

ISBN:9781337517942

Author:NICHOLSON

Publisher:NICHOLSON

Chapter11: Profit Maximization

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Problem 11.3P

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1a) A firm’s estimated long-run total cost function is LRTC = 160Q - .6Q²+ .002Q³. Suppose the firm is producing 100 units of output. The cost elasticity is ____ You can use Excel spreadsheet or otherwise to answer this question.

b) A research study published in Social Science Medicine, “Production Functions for General Hospitals,” estimated the following general hospital production function in the Netherlands: Q = 5*Staff^.34*Beds^.64*Drugs^.04*Specialists^.02, where Q is a measure used by the authors for patient care. Suppose a hospital currently utilizes the following inputs: Staff =20, Beds = 120, Drugs = 60, Specialists =10. Use a spreadsheet to find the following or otherwise. If the hospital increases its specialists by one (1), that is, employs an 11^th specialist, the increase in Q (marginal product) will be:
c) A study published in Social Science Medicine, “Production Functions for General Hospitals,” estimated the following general hospital production function: Q = 5*Staff^.34*Beds^.64*Drugs^.04*Specialits^.02, where Q is a measure used by the authors for patient care. If we increase all inputs by 1%, the percentage change in Q will be:

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