A firm has the production function q = f(L, K) = min{L¹/2, K1/2). This firm has: increasing returns to scale decreasing returns to scale None of the above constant returns to scale

Lesson 7- Production Question 8

A firm’s short-run production function is in the form of                        q = aLK +(bL^2)K −(cL^3)K , wherea, b, c > 0 are parameters. K is a constant. (a) Derive the marginal product of labor.(b) Find the level of L, expressed in terms of the parameters, at which the law ofdiminishing marginal product kicks in.

Which of the following production functions exhibit decreasing returns to scale? Select all that apply. O Q = 2K0.4 L0.6 O Q=0.5 K0.3 0.7 OQ=0.7 K0.4 L0.3 = K0.25 L 0.5 Q = 0.3 K0.5 L0.7 OQ=0.2 K0.3 L0.8

A firm estimates its long-run production function to be Q = -0.0050 K³L³ + 15 K²L² Suppose the firm employs 10 units of capital. At product of labor begins to diminish. A) 150 B) 66.67 C) 1000 D) 100 E) 200 I units of labor, marginal

Consider a short run production function q=5L+K, using L units of labour and K units of capital. Compute the marginal product of labour.                                      2. Does the production function exhibit decreasing, increasing or constant returns to scale?

Suppose a firm has the following production function Q (K, L) =K0.5 L0.4. Show mathematically whether the firm has increasing, decreasing, or constant returns to scale.

Firm "Happy Capitalist" has following production function: f(K, L) = 2*k0.2L0.8. Furthermore, it is known that cost of capital (r) is equal to 2 and cost of labour (w) is 4. Having said that, capitalist wishes to maintain an output of 250 at lowest possible cost. We ask: a) Solve cost minimisation. Also, is it a corner solution or an interior solution; b) Graph previous result: isoquant and isocost of production; c) Determine average productivity of each factor; d) Is it a function with returns to scale of what type, increasing, decreasing or constant? e) Calculate elasticity of input-output