BJOⒸ4 f(X₁, X₂) = (x₁² + X₂²) & 0

This can be described as a concept that provides the representation of the relationship b/w the…

BJO 14 f (X₁₁X₂) = (x₁² + X₂²) = осред a) What value of p and B, IRTS, CRTS, ORTS b) If there is DRTS, Find long-run cost function c) Derive output supply function unconditional input demand function

BJO 14 f (X₁₁X₂) = (x₁² + X₂²) = осред a) What value of p and B, IRTS, CRTS, ORTS b) If there is DRTS, Find long-run cost function c) Derive output supply function unconditional input demand function

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Concept explainers

Isocost and Isoprofit Curve Analysis

An isocost curve in the production theory that is a crucial part of economics depicts different combinations of factor inputs at a given market cost. In other words, this shows all the combinations of production factors that cost the same for the firm to employ. Usually, this can be depicted as a downward sloping straight line when the firms act as the price-takers in the factor markets. The slope of this mainly depicts the relative prices of different production factors.

Question

BJO
Ⓒ4 f(X₁, X₂) = (x₁² + X₂²) & 0<p<₁
a) What value of p and B, IRTS, CRTS, ORTS
b) If there is DRTS, find long-run cost function
c) Derive output supply function unconditional input demand function

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Step 1: Define supply function

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Step 2: Calculate the value of p and B

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Step 3: Find the long-run cost function

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Step 4: Drive the demand and supply function

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