Microeconomics Answers

Suppose the utility function for Bernard is given by Z=2H₁H₂ and his income equation by Y=P₁H₁+P₂H₂

Derive the demand equation for H₁H₂

The production of Fresh Milk at the University of Ghana's LIPREC is characterized by the following production function:

1.75K^1.4 L^0.6

a Compute the factor intensity ratios and comment on each.

b. The Fresh Milk production function is characterized by decreasing returns to scale.Do you agree with this statement? Why?

c. Compute the marginal product of capital (MPk) and the Marginal product of labour (MPl)

d. Compute the MRTS l,k

e. What is the magnitude in the efficiency parameter of the Fresh Milk production technology?

What does this efficiency parameter imply.

The income elasticity of demand of commodity M, elasticity income is 0.48

a Interpret the magnitude in the elasticity value

b.Write the formula for calculating such an elasticity (define all symbols)

c.By how much will demand of commodity M change if income should decrease by 12.5%

What is economic

Are the one who determine the demand of products

what are an appropriate measure of how sensitive the quantity demanded is to changes in price, income and price of goods? what affects those sensitivities? (10 marks)

If the price (P) of maple syrup is $4.00 per can, average cost (AC) is $4.50 per can and average variable cost (AVC) is $3.00 per can, then to maximize profit or minimize loss the firm should:

You are given the production function: Q(K,L)=10KαLβ

Does the above function exhibit increasing, decreasing or constant return to scale? Illustrate why and explain what this means.

You are given the production function: Q(K,L)=10KαLβ

What is the marginal rate of technical substitution (MRTS)? Simplify fully

You are given the production function: Q(K,L)=10KαLβ

What is the average product of labour, holding capital fixed at K? Simplify fully