Use the firm's long-run cost-minimizing decision rule to explain the differences in the relative use of capital and labor in agriculture in the United States and the Peoples Republic of China

Q: Assume the Cobb-Douglas production function is Q= L ^0.75 K^0.5 and if price of labor per day is 5…

A: Given  Q =L0.75 K0.5     ......... (1) Price of labour = 5 birr per day  Price of capital = 10 birr…

Q: Consider the following equation: Y = F (K, AN) Based on this equation, explain the concepts of…

A: Given,  Y=F(K, AN)where, Y is output K is Capital and AN is Effective Labor.Here, Y is a function of…

Q: Student tuition at Boehring University is $160 per semester credit hour. The state supplements…

A: In economics, the production function illustrates the relationship between the inputs used in a…

Q: True/False? Discuss. If there weren’t diminishing marginal returns all the rice in the world could…

A: The law/fundamentals of Diminishing-Marginal-Returns (DMU) states that while working with fixed…

Q: The following is cost information for the Creamy Crisp Donut Company. Entrepreneur's potential…

A: The economic cost is the sum of all losses of any goods that have a monetary value attached to them…

Q: TP = 500 kº.7L0.4 B = 50,000 P₁ = 300 P₁ = 500

A: We have isocost equation as B = K*Pk + L*PL

Q: The marginal-cost (MC) curve and the average-variable-cost (AVC) curve are same images of the…

A: MC is the cost which is associated with the MP and the cost which is associated with the AP is the…

Q: 1. Suppose the production function for sea waters during a particular period is represented by…

A: Q = F(K,L) = 6000 K2 L2 - 1000 L3This is a given production function which explains the relationship…

Q: Which of the following production functions demonstrates constant returns to scale? I. Q=5L+2K II.…

A: Constant returns to scale condition.Q(λK,λL)=λQ(K,L)

Q: True or False. Please explain The production function f(x1,x2,x3) = (min{0.5x1;0.75x2 })0.5 ·x30.5…

A:

Q: How are increasing returns to scale for a long-run production function and a downward sloping…

A: The increasing returns to scale means that the output is rising in a larger fraction than the rise…

Q: Calculate the multifactor productivity in dollars per dollar for the following: 6660 units produced,…

A: Multifactor productivity is the measurement that compares the output with the total amount of inputs…

Q: connection with the Law of the Minimum and the Law of Diminishing Returns, describe how the…

A: Agricultural based production system refers to firms that are producing goods and services based on…

Q: factors of production

A: The production factors help the production process to run efficiently. There is main four production…

Q: How would the long run total cost curve change if the price of capital increase? Explain your answer…

A: Long run total cost curve show the total cost of optimal choice of combination for labor and capital…

Q: A firm can use three different production technologies, with capital and labour  requirements at…

A: The firms use different types of inputs in different production technology to produce goods. Labor…

Q: Suppose the firm is operating in a high-wage country, where capital cost is $100 per unit per day…

A: The main objective of every firm is to utilize its inputs in such a way that its profits are…

Q: The following is cost information for the Creamy Crisp Donut Company. Entrepreneur's potential…

A: Accounting cost =Annual lease on building +Payment to workers + Utilities cost…

Q: 3. (Long-run costs,) Carmela's pasta factory employs workers and pasta machines according to the…

A: Given:- Production function: f(L,K)=l0.5K0.5Hourly cost of capital=$10Hourly cost of worker=$40 To…

Q: Some individuals decry the decline of the small family farm and its replacement with the huge…

A: The situation of reducing the total cost during the process of increasing production is referred to…

Q: The law of diminishing marginal returns will occur in a competitive firm as labor input is varied…

A: According to the law of diminishing marginal return, marginal return of labor will decline if we…

Q: The amount of fish caught per week on a trawler is a function of the crew size assigned to operate…

A: The marginal and average product of the worker or labor is useful in calculating the amount of fish…

Q: [How does the impact of fixed costs change production decisions in the short run and in the long…

A: An increase (decrease) in fixed cost does not change MC or AVC, but increases (decreases) AFC, which…

Q: For each of the following examples, explain whether it is a case of external or internal economies…

A: - External economies of scale happen when the expense per unit of result relies upon the size of the…

Q: The change in the optimal capital-labor ration if both inputs are perfect complements in production…

A: If both inputs are perfect complementary good in productions, it means that both inputs are used in…

Q: Understanding business environment is essential task of Top management. Profitability is influenced…

A: Business environment refers to the factors that affect the business activities of a firm either…

Q: Contrast the concepts diminishing marginal productivity and decreasing returns to scale with…

A: Diminishing Marginal Productivity means with every additional input employed in the production…

Q: Suppose that a firm's monthly marginal return from every dollar spend on research & development is…

A: Answer -

Q: Evaluate the view that the main goal of firms will always be cost minimization. 2. You are…

A: 1. Every organization works with the primary motive of maximizing its profit. In order to maximize…

Q: .Suppose a production technology of a firm is represented as Q(K, L) = A[aK¯b + (1 – a)L-"] (A > 0;…

A: Given  Production function: Q(K,L)=AaK-b+1-aL-b-1b              ............ (1) where A>0;…

Q: Discuss the nature of capital that will be required by farming enterprise.

A: The financing of the farming enterprise is complicated and it is often difficult to compete with…

Q: Draw labeled graph according to the question: The change in the optimal capital-labor ratio if both…

A: If both the inputs(labour and capital) are perfect complements in production, they are to be used…

Q: What must an entrepreneur do to earn a profit? How do theactions of firms earning profits influence…

A: Profits are important as they show how productive a company's activities are. Furthermore, profits…

Q: total output

A: An increasing-cost industry tends to occur because the entry of new firms as being prompted by an…

Q: Consider yourself an owner/manager of a food franchise business. In what situation or circumstances,…

A: Capital budgeting entails selecting projects that increase a company's worth. The capital budgeting…

Q: At the profit maximizing level of input use, Which of the following are true? (i) MVP=0 (ii) MVP=MIC…

A: MVP (Marginal value product) is the additional revenue generated from hiring or employing an extra…

Q: Microeconomics - Production Function Find the returns to scale of the following production…

A: In order to find the returns to scale of the production function , We put a constant before every…

Q: Define returns to scale and its implications for production decisions.

A: Returns to scale refers to the percentage change in the output with respect to the percentage change…

Q: 6. Which one of the following production functions represents an increasing returns to scale…

A: Returns to scale refer to describe the rate at which output rises as one rises the scale at which…

Q: Find TC, MC, AFC, AVC, and ATC from the following table. Instructions: Enter your responses rounded…

A:

Q: Discuss Factor Abundance, and Economies of Scale In detail.

A: The resources in any economy are limited or scarce. The resources have many alternative uses due to…

Q: Given the following Cobb-Douglas production function, how much more output is produced by adding one…

A: We have given production function and level of inputs L =25 and K=100.

Q: How would you determine that a two-input Cobb-Douglas production function has decreasing returns to…

A: Answer to the question is as follows :