3. On Monday, a coffee shop has one worker and one coffee machine. The manager hires a second member of staff on Tuesday. The two workers argue with each other and production on Tuesday is less than it was on Monday. What technical assumption over production functions does this violate? Explain your answer.

Question 3 If a firm is able to double output when it doubles input, it has... Group of answer choices diminishing marginal product increasing returns to scale constant returns to scale decreasing returns to scale

FC VC Question A3 Bob runs a book-binding business, and the production of bound books requires two inputs: the binding machine and labour. The production function exhibits diminishing returns, to labour. Which of the following statement is incorrect in the short run? The production function is concave in the labour input. (b) Average total cost is increasing in output. (c) Short-run total cost is convex in output. (d) Variable cost is convex in output. Increx y ос

4. A firm has production function q = KL. The wage and rental rates are both 10. a. Does this production function exhibit increasing, decreasing, or constant returns to scale? Explain. b. The firm currently has 50 units of capital. What are its short run total cost (TC), marginal cost (MC), average variable cost (AVC), and average total cost (ATC) functions? Draw MC, AVC, and ATC on a well-labeled graph. Does this firm have a diminishing marginal product of labor? Explain. C.

Question 4. [Costs - Short Run vs Long Run] Following is a firm's production function for soccer balls: q=√k₂l, where k₁ is the fixed amount of k(capital equipment) in the short run, and I is the amount of labor. a)) Calculate the firm's short-run total costs as a function of q, v, w and k₁ (where v = unit capital price; w= unit labor price) b)(ints) Given q, v, and w, how should the capital stock be chosen to minimize short-run total cost? c) d) ) Using your answer from b) above, calculate the long-run total cost of soccer ball production. For v=$1, w=$4, and k₁=100, at what level of q is short-run cost function tangent to the long-run cost function?

Assume that a firm uses just two factors of production. The table given below shows what happens to output as the firm increases one or both of these inputs. The effects of increasing the amounts of both inputs Situation (i) Situation (ii) Input Input 2 Output Input 1 Input 2 Output 1 1 12 1 14 2 2 24 2 2 24 3 3 36 3 2 32 4 4 48 4 2 38 5 60 2 42 Which situation represents the long run?

13. Suppose you have a production technology given by f(x1, x2) = min{2x₁, x2} and you are producing at the point where x₁ = 10 and x₂ = 20. (a) Explain in words what we mean (generally) by the ‘marginal product' of an input in production. (b) For the production technology in this question and the initial point x₁ = 10 and x2 = 20, what is the marginal product of a small increase in input 1? (c) Suppose input 2 increases and you are now at the initial point x₁ = 10 and x2 = 30. Relative to your answer in part (b), does the marginal product of input 1 decrease, increase, or stay constant? Explain briefly.

1.    A firm’s production function is  Q = L1/2 K1/2 They have 16 units of capital (which is fixed in the short-run). The unit cost of labour is 2 and the unit cost of capital is 4. They receive an order of 4. a)    Is the cost of fulfilling the order lower in the short- or long-run? Why is this the case?

Q. Table 3 above shows how output varies with only one variable input used in production. If the cost of a unit of labor is $500, what is the approximate marginal cost of the 230th unit of output?       a. $2.50       b. $8.50       c. $12.50       d. $50.00       e. $100.00

The inverse demand curve corresponding to the following equation is:  Qd= 100 - 3P The inverse equation is?