A firm has the production function Q(L, K) = √K + 2√L. The price of one unit of capital isR> 0, and the price of one unit of labor is W> 0. Which of the following statements iscorrect?The production function can be represented by a CES production function [aL + bKº] for suitablevalues of a, b and p.The production function has increasing returns to scale.The marginal rate of technical substitution is MRTS (L, K) =2√LVROfW= R. the fi rm's demand for labor is four times the demand for capital.

The CES production function is a mathematical representation used in economics and production theory…

A firm has the production function Q(L, K) = √K+2√L. The price of one unit of capital is R> 0, and the price of one unit of labor is W> 0. Which of the following statements is correct? The production function can be represented by a CES production function [aL + bK"] for suitable values of a, b and p. O The production function has increasing returns to scale. The marginal rate of technical substitution is MRT Su (L,K) = 2 OfW= R. the fi rm's demand for labor is four times the demand for capital.

A firm has the production function Q(L, K) = √K+2√L. The price of one unit of capital is R> 0, and the price of one unit of labor is W> 0. Which of the following statements is correct? The production function can be represented by a CES production function [aL + bK"] for suitable values of a, b and p. O The production function has increasing returns to scale. The marginal rate of technical substitution is MRT Su (L,K) = 2 OfW= R. the fi rm's demand for labor is four times the demand for capital.

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

See similar textbooks

Similar questions

1. Assume that a firm has the following production function: q = L0.5K0.6 d. Determine, both, the marginal product of labour and capital functions (ignore c.). e. Calculate, both, the marginal product of labour and capital when L = 64, K = 32 and interpret your answers. f. Calculate the marginal rate of technical substitution when L = 64, K = 32 and interpret your answer.
1
2.4 Draw the isoquants and find the cost function corresponding to each of the following production functions: Case A : q = ²2 Case B : q=0121 + a₂%2 Case C = q=a1²² +₂²² Case D : q = min 21 (23) 01 01 where q is output, z₁ and 22 are inputs. a1 and as are positive constants. [Hint: think about cases D and B first; make good use of the diagrams to help you find minimum cost.) 1. Explain what the returns to scale are in each of the above cases using the production function and then the cost function. Hint: check the result on page 25 to verify your answers/ 2. Discuss the elasticity of substitution and the conditional demand for inputs in each of the above cases.
Consider the following Cobb-Douglas production function: Y = 10L04K04. Suppose that the price of labor is w = 20 and the price of capital if r = 40. a- Derive the total cost curve for this production function. b- Derive the marginal cost curve for this production function. c- Plot the marginal and total cost curves for q = 1,2,3,4,5. What does it tell you about economies of scale for the production function? d- Suppose that the wage rate went up from 20 to 30. What would happen to the total wage bill relative to total costs, wL ;? What would happen to total costs? wL+rk*
Consider a short run production function q = cL+ K where the value for c = 3, using L units of labour and K units of capital. a) Compute the marginal product of labour. b) Does the production function exhibit decreasing, increasing or constant returns to scale? With a diagram. Note: The writing is clear and abbreviations are not allowed.
I need the asnwer of g
May I know the correct answer???
Which of the following statements is (are) TRUE?I. If labor and capital are perfect substitutes in production, the isoquant is a downward-sloping line.II. If a company needs to use inputs in fixed proportion such that the capital to labor ratio is always 2, the firm's isoquants are L-shaped.III. If the production function is given by Q = min(14, 7), the firm can produce, at minimum, 21 units of output. IIII, II, and IIIII and II Note:- Do not provide handwritten solution. Maintain accuracy and quality in your answer. Take care of plagiarism. Answer completely. You will get up vote for sure.
Suppose that a firm has a production function given by: q= 10 L² K. The firm has 10 units of capital in the short run. Which of the following will describe the marginal product of labor (MPL) for this production function? Select one: a. Constant Marginal Returns to Labor b. Increasing Marginal Returns to Labor O c. Decreasing Marginal Returns to Labor
(a) Solve for and graph this firm’s isoquant at q = 10. Please label three points along this isoquant b) Does this production function exhibit increasing, decreasing, or constant returns to scale? Explain. Please corroborate your answer using a set of isoquants when the quantity of both inputs gets doubled.
I need this in words Not handwritten or no pic
2. Consider a production function: x(l, k) = Alªk³. Showing all of your work: (a) Under what conditions are the marginal products of labor 1 and capital k positive? (b) Under what conditions are the returns to labor and capital diminishing? (c) Under what conditions are the returns to scale increasing, decreasing, and constant?