The fact that the production function has constant elasticity of scale means tha O If we get 10% more workers, output goes up by 10% O If we get 10% more workers, 10% more physical capital, 10% more human capital, and 10% more natural resources, output goes up by 10% O Output always goes up by 10% O Output always goes up by less than 10% OIt is impossible to determine how much output will go up without measuring the amount of elastic produced in a particular economy.

The fact that the production function has constant elasticity of scale means tha O If we get 10% more workers, output goes up by 10% O If we get 10% more workers, 10% more physical capital, 10% more human capital, and 10% more natural resources, output goes up by 10% O Output always goes up by 10% O Output always goes up by less than 10% OIt is impossible to determine how much output will go up without measuring the amount of elastic produced in a particular economy.

Microeconomic Theory

12th Edition

ISBN:9781337517942

Author:NICHOLSON

Publisher:NICHOLSON

Chapter11: Profit Maximization

Section: Chapter Questions

Problem 11.9P

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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
I am having trouble finding out the formulas to complete this question: The production function for a firm is q = -0.6L3 + 18L2K + 10L where q is the amount of output, L is the number of labor hours per week, and K the amount of capital. The wage is $100 and the rental rate is $800 per timeperiod. Using Excel, calculate the total short-run output, q(L), for L = 0, 1, 2, …, 20, given that capital is fixed in the short run and K = 1. Also calculate the average product of labor; APL, and the marginal product of labor, MPL. For each quantity of labor in (a), calculate the variable cost, VC; the total cost, C; the average variable cost, AVC; the average cost , AC; and the marginal cost, MC. Using excel, draw the AVC, AC, and MC curves in a diagram. You will not be able to solve the total product curve for L as a function of output. So, instead construct a table. Headings: L q(L) APL MPL VC TC AVC AC MC w/APL w/MPL
The production function for a firm is: q=-0.6L3+18L2K+10L where q is the amount of output, L is the number of labor hours per week, and K is the amount of capital. The wage is w = $100 and the rental rate is r = $800 per time period. a Using Excel, calculate the total short-run output, q(L), for L = 0, 1, 2, …, 20, given that capital is fixed in the short run and K = 1. Also calculate the average product of labor; APL, and the marginal product of labor, MPL. b For each quantity of labor in (a), calculate the variable cost, VC; the total cost, C; the average variable cost, AVC; the average cost , AC; and the marginal cost, MC. Using excel, draw the AVC, AC, and MC curves in a diagram. Hint: you will not be able to solve the total product curve for L as a function of output. So, instead construct a table, See the headings. Use this definition ΔTC/Δq…