QUESTION 20Refer to the information provided in Figure 7.11 below to answer the question(s) that follow.Units of capital2000A$9$36$900COB-q³=300q²=200q¹=100100Units of laborFigure 7.11Refer to Figure 7.11. If the firm's cost of capital is $18 per unit, then its cost of labor is$1.80per unit.

Given The cost of capital is $18 per unit. Then the vertical intercept of the isocost line is 200…

JESTION 20 Refer to the information provided in Figure 7.11 below to answer the question(s) that follow. Units of capital 200 0 O $9 A $36 $900 B q³=300 q²=200 q¹=100 100 Units of labor Figure 7.11 Refer to Figure 7.11. If the firm's cost of capital is $18 per unit, then its cost of labor is $1.80 per unit.

JESTION 20 Refer to the information provided in Figure 7.11 below to answer the question(s) that follow. Units of capital 200 0 O $9 A $36 $900 B q³=300 q²=200 q¹=100 100 Units of labor Figure 7.11 Refer to Figure 7.11. If the firm's cost of capital is $18 per unit, then its cost of labor is $1.80 per unit.

Microeconomics A Contemporary Intro

10th Edition

ISBN:9781285635101

Author:MCEACHERN

Publisher:MCEACHERN

Chapter7: Production And Cost In The Firm

Section7.A: Appendix: A Closer Look At Production And Cost

Problem 1AQ

See similar textbooks

Similar questions

10. If over the range of positive marginal product, the short-run total product of factor A in the production of X is given by the equation: X=aA +b A2 – A3 Where a, and b are positive constants, and if the average product of A is maximized when X=100, then the marginal product of A must be greater than the average product when X=50. True or False ?. Prove your answer.
Juztine Company produces a single type of necklace being sold for P 25 per unit. The following information was made available:Unit sales (P 25 per unit) 63,000 Material usage 75,000 pounds Material cost P7.2 per pounds Labor hours 10,000 hours Labor cost P30 per hourWhat is the financial partial productivity of Direct Labor?
The firm employs workers for R100 per day. Each unit sells for R30. The firm’s production function is as follows: Labour Output 1 6 2 11 3 15 4 18 5 20 6 21 Q3.2.1 Re-draw the table above and add two columns one showing the Marginal Physical Product and the other column showing the value of the marginal product of labour MRP) at each input level.
Can you put a solution to this? Instruction: (see other instructions below, for the submission of answer sheet) A. Complete the Column for MRS. Show your solution for each answer, Number each solution that corresponds to each unknown MRS. B. Graph the Labor-Capital function, making sure that Labor units are in the horizontal axis MRS = change in K/ change in L change in K = final K - initial K change in L = final L - initial L MRS = 26-30 /2-1 MRS = -4/1 MRS = - 4 Units of Labor Capital MRS 1 30 0 2 26 -4 3 22.5 (1) 4 19.5 (2) 5 17 (3) 6 15 (4) 7 13.5 (5) 8 12.5 (6) 9 12 (7) 10 12 (8)
A firm produces good Y with just 2 factors: Capital which is fixed in supply and labour which is variable. Identify the stages of production in the diagram and explain why the firm still hire labour even though it is in the range of diminishing returns. What is the number of workers after which diminishing marginal returns starts? Is this a short run or long run phenomenon? Labour (units) 1 2 3 4 5 6 7 8 9 Total Product (TP) in Units 8 15 24 30 35 37 38 38 36 Average Product (AP) in units 8 7.5 8 7.5 7 6.17 5.43 4.75 4 Marginal Product (MP) in units 8 7 9 6 5 2 1 0 -2
A firm produces output according to a production function: Q = F(K,L) = min {4K,8L}. a. How much output is produced when K = 2 and L = 3? 192 Numeric ResponseEdit Unavailable. 192 incorrect.unit(s) b. If the wage rate is $60 per hour and the rental rate on capital is $20 per hour, what is the cost-minimizing input mix for producing 8 units of output? Capital: 80 Numeric ResponseEdit Unavailable. 80 incorrect. Labor: 480 Numeric ResponseEdit Unavailable. 480 incorrect. c. How does your answer to part b change if the wage rate decreases to $20 per hour but the rental rate on capital remains at $20 per hour? multiple choice Capital and labor increase. It does not change. Capital increases and labor decreases. Incorrect Capital decreases and labor increases.
A firm uses labour, L and capital K, to produce a single product, X. capital is fixed but labour is variable. The firm’s production function is: X=-0.2L3 + 18L2 + 1620L. Where X is the number of units of the product per week, and L is the number of persons employed. A t what weekly output is marginal cost equal to average variable cost? if the price of the product is $0.20 per unit, what is the maximum weekly wage that the firm would pay rather than close down?
onsider a producer with budget C = 200 who can buy labor L at a wage w = 10 and capital K at a price r = 5. The producer has the following production function F(K,L) = 3K1/3 L2/3 . a. Does F(K,L) exhibit increasing, decreasing, or constant returns to scale? Show your work. Consider a new production function F(K,L) = K1/3 L2/3 , where is a? ? positive constant not equal to 3. Does the new production function exhibit increasing, decreasing, or constant returns to scale? b. Using F(K,L) = 3K1/3 L2/3, find the optimal bundle. Show your optimal bundle on a plot (this should include isoquant and isocost curves). c. Suppose the budget is reduced to C = 100 and then C = 50. Find the new optimal bundles. Plot these bundles, along with the initial optimal bundle, on one plot. Draw the expansion path PLEASE SHOW GRAPHS do not use chat gpt
4. Ikea Inc., a home remodeling business. The number of square feet they can remodel in a day is described by the Cobb-Douglas production function Q= F (L,K)= 4K5L0.5 where L is their number of workers and K is units of capital. The wage rate is $5 a day, and a unit of capital costs $20 a day. What is their minimum cost input combination for remodeling (Q=200) 200 square feet a day? What is the total minimum cost level? (15p)
F (L, K) = L0.2K0.7， The wage rate (price per unit of labour) is w = 2 and the capital rental rate (price per unit of capital) is r = 7. Does this production function exhibit increasing, decreasing or constant returns to scale? Explain. What is the marginal productivity of labour and the marginal productivity of capital for (L,K) = (1,1)? Would a firm (which minimises costs) use this combination of labour and capital? Explain. If your answer is yes, then what would be the quantity of production for which the company would use this combination?
Assume that the production function of a firm is Q = L0.23K0.10. L = labor, K = capital.Referring to the information given,i. Calculate the technical suit replacement rate (MRTS) of the firm? ii. Calculate the value and explain the form of return according to the scale (return to scale) of the firmthe?
Suppose that the production function for Hannah and Sam's home remodeling business is Q = F(L,K) Q = 10L0.1K0.4.Assume the wage rate is $8,000 per week and the cost of renting a unit of capital is $1,000 per week.a. What is the least-cost input combination for remodeling 400 square feet each week? Instructions: Round your answers to 2 decimal places. units of labor and units of capital. b. What is the total cost? Instructions: Round your answer to 2 decimal places. $ .revised jrl 08-11-2011