EBK ECONOMICS
13th Edition
ISBN: 8220106799642
Author: PARKIN
Publisher: PEARSON
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Question
Chapter 11.4, Problem 2RQ
To determine
Application of law of diminishing returns to capital.
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Labor and capital can never be substituted for each other. true or false?
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Chapter 11 Solutions
EBK ECONOMICS
Ch. 11.1 - Prob. 1RQCh. 11.1 - Prob. 2RQCh. 11.2 - Prob. 1RQCh. 11.2 - Prob. 2RQCh. 11.2 - Prob. 3RQCh. 11.3 - Prob. 1RQCh. 11.3 - Prob. 2RQCh. 11.3 - Prob. 3RQCh. 11.3 - Prob. 4RQCh. 11.3 - Prob. 5RQ
Ch. 11.4 - Prob. 1RQCh. 11.4 - Prob. 2RQCh. 11.4 - Prob. 3RQCh. 11.4 - Prob. 4RQCh. 11.4 - Prob. 5RQCh. 11 - Prob. 1SPACh. 11 - Prob. 2SPACh. 11 - Prob. 3SPACh. 11 - Prob. 4SPACh. 11 - Prob. 5SPACh. 11 - Prob. 6SPACh. 11 - Prob. 7SPACh. 11 - Prob. 8SPACh. 11 - Prob. 9SPACh. 11 - Prob. 10SPACh. 11 - Prob. 11SPACh. 11 - Prob. 12SPACh. 11 - Prob. 13SPACh. 11 - Prob. 14SPACh. 11 - Prob. 15APACh. 11 - Prob. 16APACh. 11 - Prob. 17APACh. 11 - Prob. 18APACh. 11 - Prob. 19APACh. 11 - Prob. 20APACh. 11 - Prob. 21APACh. 11 - Prob. 22APACh. 11 - Prob. 23APACh. 11 - Prob. 24APACh. 11 - Prob. 25APACh. 11 - Prob. 26APACh. 11 - Prob. 27APACh. 11 - Prob. 28APACh. 11 - Prob. 29APACh. 11 - Prob. 30APACh. 11 - Prob. 31APACh. 11 - Prob. 32APA
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- True or false The law of diminishing returns implies that the marginal product of labor (MPL) is increasing as labor input increases.arrow_forwardA production function is given by q = 500L + 320K. The price of capital is $120 and the price of labor is $100. What is the marginal product of capital divided by the price of capital? Answer to two decimal places.arrow_forwardA firm's production function is: q = 20L1/2K1/2 where q is the firm's total product, L is the quantity of labor employed, and K is the quantity of capital employed. The price of labor is $25 per unit and the price of capital is $100 per unit. a. What is the equation for the marginal product of labor? b. What is the equation for the marginal product of capital? c. Given the price of labor is $25 per unit and the price of capital is $100 per unit, what is the cost-minimizing combination of capital and labor that can produce 800 units of output?arrow_forward
- Assuming labor is the only variable factor and paid at a constant wage rate ? show that the average variable cost (AVC) is inversely related to productivity?arrow_forwardSuppose that the marginal product of labor for a local bakery is 120 units per day and the price of labor is $10 per day. Instructions: Enter your answers as a whole number. a. What does the least-cost rule say that the ratio of the marginal product of capital to the price of capital should be? Book b. Now suppose that the marginal product of labor is 120 units per day, the price of labor is $10 per day, and the price of capital is $3 per day. What does the least-cost rule say that the marginal product of capital should be? Print Referencesarrow_forwardPlease Show Each and Every Working VERY CLEARLY! marginal productivityarrow_forward
- Given the production function for labor and capital: Q = L^½(K^½), and q = 100. If the firm wants to increase all inputs by a common factor t, where t > 0. What happens to the output that the firm produces?arrow_forwardSuppose that the marginal product of labor for a local bakery is 84 units per day and the price of labor is $4 per day. Instructions: Enter your answers as a whole number. a. What does the least-cost rule say that the ratio of the marginal product of capital to the price of capital should be? b. Now suppose that the marginal product of labor is 84 units per day, the price of labor is $4 per day, and the price of capital is $3 per day. What does the least-cost rule say that the marginal product of capital should be?arrow_forwardThe Cobb-Douglas production function with output Q and capital and labor inputs K and L, respectively, is given by: Q = f(K,L) = K«LB where 0 < a <1 and 0arrow_forwardWhat is the difference between the factor demand derived from cost minimization and that obtained from the profit maximization? Under what conditions they can be the same?arrow_forwardYou are the owner of a puppet manufacturing company. Suppose that labour is the only variable input to the production process. If the marginal cost of production is diminishing as more units of output are produced, what can you say about the marginal product of labour?arrow_forwardAssuming the firm is minimizing its cost and the price of labour is $10 per unit and the price of capital is $20 per unit. the marginal product of labour is 50, what must the marginal product of capital be?arrow_forwardarrow_back_iosSEE MORE QUESTIONSarrow_forward_ios
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