Economics Plus MyLab Economics with Pearson eText (2-semester Access) -- Access Card Package (6th Edition) (The Pearson Series in Economics)
6th Edition
ISBN: 9780134417295
Author: R. Glenn Hubbard, Anthony Patrick O'Brien
Publisher: PEARSON
expand_more
expand_more
format_list_bulleted
Concept explainers
Question
Chapter 11.A, Problem 11PA
To determine
Isoquant, Input price ratio and input combination.
Expert Solution & Answer
Want to see the full answer?
Check out a sample textbook solution
Students have asked these similar questions
Exhibited in the table below are the two isoquants and the isocost for a hypothetical firm
A
B
C
D
E
F
Labor
40
28
18
10
4
0
Capital
1
2
3
4
5
6
Labor
80
38
28
20
14
10
Capital
1
2
3
4
5
6
Labor (P2/unit)
25
20
15
10
5
0
Capital
(P5/unit)
0
2
4
6
8
10
In a single graph, please perform the following:
A. Draw the Isoquant curve
B. Draw the isocost
C. Identify the optimal point which is tangent to the isoquant line. Please mark the spot as X.
D. How many units of capital and labor is the optimal combination
When analyzing isoquants, if the marginal product of all inputs double, how would that change the input mix you would use to produce a given level of output?
For each of the following examples, draw a representative isoquant. What can you say about the marginal rate of technical substitution in each case?
a) A firm finds that it can always trade two units of labor for one unit of capital and still keep output constant.
b) A firm requires exactly two full-time workers to operate each piece of machinery in the factory.
Chapter 11 Solutions
Economics Plus MyLab Economics with Pearson eText (2-semester Access) -- Access Card Package (6th Edition) (The Pearson Series in Economics)
Ch. 11.A - Prob. 1RQCh. 11.A - Prob. 2RQCh. 11.A - Prob. 3RQCh. 11.A - Prob. 4PACh. 11.A - Prob. 5PACh. 11.A - Prob. 6PACh. 11.A - Prob. 7PACh. 11.A - Prob. 8PACh. 11.A - Prob. 9PACh. 11.A - Prob. 10PA
Ch. 11.A - Prob. 11PACh. 11.A - Prob. 12PACh. 11.A - Prob. 13PACh. 11.A - Prob. 14PACh. 11.A - Prob. 15PACh. 11 - Prob. 11.1.1RQCh. 11 - Prob. 11.1.2RQCh. 11 - Prob. 11.1.3PACh. 11 - Prob. 11.1.4PACh. 11 - Prob. 11.1.5PACh. 11 - Prob. 11.2.1RQCh. 11 - Prob. 11.2.2RQCh. 11 - Prob. 11.2.3RQCh. 11 - Prob. 11.2.4RQCh. 11 - Prob. 11.2.5PACh. 11 - Prob. 11.2.6PACh. 11 - Prob. 11.2.7PACh. 11 - Prob. 11.2.8PACh. 11 - Prob. 11.2.9PACh. 11 - Prob. 11.2.10PACh. 11 - Prob. 11.2.11PACh. 11 - Prob. 11.2.12PACh. 11 - Prob. 11.3.1RQCh. 11 - Prob. 11.3.2RQCh. 11 - Prob. 11.3.3RQCh. 11 - Prob. 11.3.4PACh. 11 - Prob. 11.3.5PACh. 11 - Prob. 11.3.6PACh. 11 - Prob. 11.3.7PACh. 11 - Prob. 11.3.8PACh. 11 - Prob. 11.3.9PACh. 11 - Prob. 11.3.10PACh. 11 - Prob. 11.4.1RQCh. 11 - Prob. 11.4.2RQCh. 11 - Prob. 11.4.3RQCh. 11 - Prob. 11.4.4PACh. 11 - Prob. 11.4.5PACh. 11 - Prob. 11.4.6PACh. 11 - Prob. 11.4.7PACh. 11 - Prob. 11.4.8PACh. 11 - Prob. 11.4.9PACh. 11 - Prob. 11.4.10PACh. 11 - Prob. 11.5.1RQCh. 11 - Prob. 11.5.2RQCh. 11 - Prob. 11.5.3PACh. 11 - Prob. 11.5.4PACh. 11 - Prob. 11.5.5PACh. 11 - Prob. 11.5.6PACh. 11 - Prob. 11.5.7PACh. 11 - Prob. 11.5.8PACh. 11 - Prob. 11.5.9PACh. 11 - Prob. 11.6.1RQCh. 11 - Prob. 11.6.2RQCh. 11 - Prob. 11.6.3RQCh. 11 - Prob. 11.6.4RQCh. 11 - Prob. 11.6.5RQCh. 11 - Prob. 11.6.6PACh. 11 - Prob. 11.6.7PACh. 11 - Prob. 11.6.8PACh. 11 - Prob. 11.6.9PACh. 11 - Prob. 11.6.10PACh. 11 - Prob. 11.6.11PACh. 11 - Prob. 11.6.12PACh. 11 - Prob. 11.6.13PA
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, economics and related others by exploring similar questions and additional content below.Similar questions
- What is the difference between a fixed input and a variable input?arrow_forwardDraw a graph showing a set of isoquants that depict capital and labor to be perfect complements (not substitutable at all) in a production function that exhibits constant returns to scale. Be sure to label the input and output levels on the isoquants.arrow_forwardDraw two isoquants for this firm. On the same graph, draw and label firm α’s expansion path at these prices of capital and labor.arrow_forward
- What is technical rate of substitution? Show it graphically.arrow_forwardSuppose the isoquant represents the production of 120 pencils. What will happen to the isocost and isoquant if the following situations occur? a. Labor becomes more costly. b. The budget for production is allowed to increase in order to increase the production of pencils, while keeping the price of inputs the same. c. The demand for pencils suddenly increase, thus increasing its price.arrow_forwardQ3) A chair manufacturer hires its assembly-line labor for $30 an hour and calculates that the rental cost of its machinery is $15 per hour. Suppose that a chair can be produced using 4 hours of labor or machinery in any combination. Graphically illustrate the isoquant and the two isocost lines for the current combination of labor and capital and for the optimal combination of labor and capital.arrow_forward
- The fast food company Schnabb uses labor and capital to produce its product. Holding the production fixed, what is the effect of a lower price of capital on the ratio between the number of workers and the amount of capital used? Explain using isocosts and an isoquant.arrow_forwardPrunella raises peaches. She uses L units of labor, and T units of land to produce peaches. Her production function is f(L, T)= L1/2T 1/2 A: Write the equation and plot the isoquant for the output quantity 4. B: What is the returns to scale of this production function? C: Find the marginal products of labor and land. What is the rate of technical substitution between land and labor? D: In the short-run, Prunella cannot vary the amount of land she uses. Plot the output as a function of labor only for the fixed level of land of T=1. E: Find the marginal product of labor from L=4 and show it on the graph. Is the marginal product of labor diminishing, constant or increasing in labor? F: Suppose wages are constant and equal w, fixed costs are zero. Find the short-run profit maximizing level of labor for T=1. Please see the attached photoarrow_forwardIsoquant curves and isocost curves are tools that can explain how a firm might best respond to changes in the production environment. Present an example of an isocost curve where labor and capital are the two inputs, and explain what it is using language someone not trained in economics could understand. Present an example of an isoquant in the same diagram you used for your isocost curve, and draw the isoquant so it cuts the isocost curve twice. Explain what an isoquant is using language someone not trained in economics could understand. Label the two points A and B, where the isocost and isoquant curves intersect. Present a logical argument that explains why the firm should operate neither at point A nor point B, and present a point that would be optimal by drawing a new isoquant curve in the diagram. Add a second isocost curve to your diagram such that the firm is spending more money on inputs. Add a third isoquant to your diagram to show a firm that would become more capital…arrow_forward
- The production function is Q = 18K + 9L. Rent is $80 and wage is $40. Draw a graph of the isocost and isoquant curves.arrow_forwardIsoquant curves The Firm can trade two doctors for five gardeners and output remains constant What is the shape is the isoquant curve for the firm? (doctors on x axis) Find slope of curve at: (20,15) (5,25) (5,15)arrow_forwardWhat does the isoquant map look like if there are 1)continuously increasing returns to scale; 2)continuously decreasing returns to scale? Please illustrate.arrow_forward
arrow_back_ios
SEE MORE QUESTIONS
arrow_forward_ios
Recommended textbooks for you
Exploring EconomicsEconomicsISBN:9781544336329Author:Robert L. SextonPublisher:SAGE Publications, Inc
Microeconomics: Private and Public Choice (MindTa...EconomicsISBN:9781305506893Author:James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. MacphersonPublisher:Cengage Learning
Economics: Private and Public Choice (MindTap Cou...EconomicsISBN:9781305506725Author:James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. MacphersonPublisher:Cengage Learning
Exploring Economics
Economics
ISBN:9781544336329
Author:Robert L. Sexton
Publisher:SAGE Publications, Inc
Microeconomics: Private and Public Choice (MindTa...
Economics
ISBN:9781305506893
Author:James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. Macpherson
Publisher:Cengage Learning
Economics: Private and Public Choice (MindTap Cou...
Economics
ISBN:9781305506725
Author:James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. Macpherson
Publisher:Cengage Learning