From the production data in the table below, calculate the VMP for the 2nd unit of labor. Assume the wage rate is $80 and the price of the firm's output is $5. (Give the numeric value only for your response; do not include commas, dollar signs, etc.) Capital Labor Output (Q) 100 100 1 20 100 2 44 100 3 66 100 4 84 100 96 100 104 100 7 98

From the production data in the table below, calculate the VMP for the 2nd unit of labor. Assume the wage rate is $80 and the price of the firm's output is $5. (Give the numeric value only for your response; do not include commas, dollar signs, etc.) Capital Labor Output (Q) 100 100 1 20 100 2 44 100 3 66 100 4 84 100 96 100 104 100 7 98

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Mrts
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Suppose that a rock star gives concerts. The production function of the concert is the following: Q(C,A,G) = (C – 10)'/4A/4G/4 where C represents hourly contribution of guitarist Chris; A represents hourly contribution of guitarist Ataman and G represents hourly contribution of guitarist George. a) If Chris has 26 units of hours, is there increasing returns to scale in production of concerts? b) Assume George has fixed amount of hours, G=16, and hourly wage of G is 5. Denote the wage of Chris= r and the hourly wage of Ataman =w. Derive Rock star's demand for inputs-C and A, respectively-as a function of output (Q). c) Assume that George has fixed amount of hours G=16 and hourly wage of G is 5. Additionally, you are given that the wage of C = r=100 and the unit wage of Ataman=w=100. Show that Rock star's short run cost function is given by TC(Q) = 1000 +50Q²-
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Consider the following equation Q = f(K, L) = K0.7 L0.3 Find (a) MRTS of labor for capital (b) Show that the production function above is homothetic (c) Returns to scale (d) Equation representing an isoquant and show that it is convex to the origin (e) Elasticity of substitution (f) Output elasticities of factors
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Consider a firm with Total Output function (Production Function) given by Q = 6L2 – 0.4L3, where L is variable labor input. The firm is faced with the decision to hire the optimal number of workers in order to maximize its output level. (a) Obtain the Marginal Product function. (b) Find the Average Product function. (c) Determine the level of employment that would maximize the firm’s output level. (d) Verify that the second-order condition is met for the firm's output maximum.
y= f(x1,x2)=x1ax2b Derive the equation for an isoquant curve. If a=b=0.5 , the price of factor 1 is 12, and the price of factor 2 is 3, find the cost minimizing input combinations and the total cost of producing 40 units of output. Redo part (c), this time by first deriving the firm’s conditional factor demand functions and the cost function.
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From your knowledge of the relationships among the various production functions, complete the following table: Variable Input L Total Product Q Average Product AP₁ Marginal Product MPL 0 0 1 2 3 4 5 6 7 30 二二二二 120 20.00 24.00 15 || 45 -15
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