Search
A firm estimated its AC curve last year and found that AC = 1000 – 0.05 Q. This year it estimated its ACs and found that they were AC = 900 – 0.05 Q Are there increasing or decreasing returns to scale?
Q = - 50 + 10 L – 0.02 L2
1) Find out MP
2) Find out AP
3) At what level of labor input does the AP curve reach its maximum? What is the MP at this input level?
1.Suppose an isoquant for a particular production process were so tightly curved that it was almost L-shaped. What would this imply about the technology?
2.Why is the TP of labor curve never downward sloping?
3.If MP is declining, is AP always declining? Why or why not?
A businessman uses K and L to produce X. Production function is: Q = 2K ( L – 2 )
PK = 600, PL = 300, TC = 15000
a) Determine marginal product function ( MP) of K and L. Determine MRTS
b) Determine Qmax
c) If he wants to produce 900 units, find out TCmin.
A firm estimated its AC curve last year and found that
AC = 1000 – 0.05 Q. This year it estimated its ACs and found that they were
AC = 900 – 0.05 Q
Are there increasing or decreasing returns to scale?
Q = - 50 + 10 L – 0.02 L2
1) Find out MP
2) Find out AP
3) At what level of labor input does the AP curve reach its maximum? What is the MP at this input level?
1. Suppose you are considering growing and selling maize and you are operating within a competitive market with no influence over price. Assume the current price of maize K70 per 100 kg and the short run cost function, where Q represents bags of maize per year is:
TC = 800 + 16Q + Q2
a) What is the profit maximizing output?
b) Calculate the profit for the output you got in (a) above?
c) Based on the rule that a firm should produce only if it covers its variable costs of production, what quantity should be produced to cover variable costs?
d) How much are the fixed costs of this business?
Draw a production possibility frontier with paddy on the horizontal axis and
maize on the vertical axis illustrating these options, showing points A–F.
Suppose that the U.S. government reduces the tariff on imported coffee, and a reputable study is published indicating that coffee drinkers have lower rates of colon cancer. What will the combined impact be on the equilibrium price and quantity of coffee? Explain your reasoning and show graphically. Make sure you think this through carefully!
WITH PRACTICAL EXAMPLES, STATE AND BRIEFLY EXPLAIN THE FOUR FACTORS OF PRODUCTION
#340153 on Dec 2023