he production function for a product is given by q=100KL. Its marginal product functions are MPL=100K and MPK=100L. If the price of capital, r, is $200 per day and the price of labor, w, is $400 per day, what is the minimum cost of producing 1,000 units of output? The minimum cost of producing 1,000 units of output is ______?

he production function for a product is given by q=100KL. Its marginal product functions are MPL=100K and MPK=100L. If the price of capital, r, is $200 per day and the price of labor, w, is $400 per day, what is the minimum cost of producing 1,000 units of output? The minimum cost of producing 1,000 units of output is ______?

Survey Of Economics

10th Edition

ISBN:9781337111522

Author:Tucker, Irvin B.

Publisher:Tucker, Irvin B.

Chapter6: Proudction Costs

Section: Chapter Questions

Problem 3SQP

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The production function for a product is given by q=100KL. Its marginal product functions are MPL=100K and MPK=100L. If the price of capital, r, is $160 per day and the price of labor, w, is $80 per day, what is the minimum cost of producing 2,000 units of output? The minimum cost of producing 2,000 units of output is $________ (Round all intermediate results to 3 decimal places and enter your response rounded to two decimal places.)
A firm can manufacture a product according to the production function Q = F(K, L) = K0.5L0.5. (a) What is the average product of labor, APL, when the level of capital is fixed at 36 units and the firm uses 16 units of labor? (b) What is the marginal product of labor, MPL, when capital is fixed at 36 units? (c) Suppose capital is fixed at 36 units. If the firm can sell its output at a price of $100 per unit of output and can hire labor at $40 per unit of labor, how many units of labor should the firm hire in order to maximize profits?
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A firm operates with the following Cobb-Douglas production function where Q is output, L is labor hours per week, and K is machine hours per week. Q = 5(L1/3K2/3) Cobb-Douglas Production Function The firm intends to produce 5,000 units of output per week by contracting employees for $40 per hour and renting machinery for $10 per hour. 1) Determine the cost minimizing combination of labor and capital for the firm 2) Based on your solution in part 1, calculate the firm’s total cost of producing 5,000 units of output per week
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