How would the long run total cost curve change if the price of capital increase? Explain your answer intuitively and graphically.

Q: a. Is it possible to have diminishing returns to a single factor of production and constant returns…

A: Law of diminishing returns and constant returns to scale are different concepts. Therefore both can…

Q: If the law of diminishing returns did not hold, we can produce a the food the world needs in one…

A: In economics, diminishing returns is the decrease in marginal output of a production process as the…

Q: 1. A firm producing hockey sticks has a production function given by q = 2Vkl The price of labor is…

A: Given information q=2KL Price of labor=W Price of capital=V Short run cost function SC=Wq24K1+VK1…

Q: How would the long run total cost curve change if the price of capital increase? Please explain your…

A: Long run Total Cost (LTC) insinuates the base(minimum) cost at which given level of yield can be…

Q: The production function feature called "increasing returns to scale" means that if we increase…

A: Meaning of Microeconomics: The term macroeconomics refers to that situation under which the…

Q: Economics Complete the table below. (Round your answers to two decimal places.) Capital, Labor, K L…

A: Fixed cost remains same at all levels of output. Variable cost is the cost that changes as output…

Q: State how is the law of diminishing returns reflected in the shape of total product curve? What is…

A: Law of diminishing returns: It refers to the theory under which when the company will produce less…

Q: using classical production function explain the stages of production of a firm and advise on the…

A: The process that is known to minimize the amount of waste and helps in bringing the product in a…

Q: Economists describe short-run decisions as "constrained" decisions, while long-run decisions are…

A: The factors of production are the factors that are being used in the process of production by the…

Q: Suppose that the cost of all inputs (both labor and capitol) decreases. What will happen to the…

A: In economics, inputs are considered as factors of production. That means, inputs are those factors…

Q: Interpret the diagram below and discuss your understanding of the concept of the inflexibility of…

A: In different time the behaviour of input changes like in short run only one factor is changeable…

Q: a) Distinguish between Cobb Douglas production function and Classical production function

A: Meaning of Microeconomics: The term macroeconomics refers to that situation under which the…

Q: Explain the difference between explicit and implicit costs, and giveexamples of each.

A: Cost refers to the expenses that firms have to incur in the production of their goods and services.…

Q: The basic characteristic of the short run is that?

A: Short-run is a period of time in which at least one input is fixed and the others are variable. It…

Q: Question 1: Consider the long-run production function for the country ABC y = 2k ^ 0.67, y is the…

A: Total Factor Productivity (TFP) or productivity is a key notion in the context of a country's…

Q: 1) Draw and label the AFC, AVC, ATC, and MC curves when FC = 0. Assume when the production level i…

A: "Since you have asked multiple questions, we will solve first question for you .. If you want any…

Q: Help me answer this review question. Fill in the Blanks.  If the marginal cost equals average cost,…

A: In a market, cost curves provide significant information about the productivity and efficiency of…

Q: What is the difference between a feasible production plan in the short run and in the long run? Give…

A: Feasible production plan in the short run: In the short run, even though the firm is facing loss, it…

Q: What is the difference between economies of scale andeconomies of scope? How do firms consider these…

A: The concepts of economies of scope and economies of scale explains the situations when the big firms…

Q: What are the different type of costs incurred in the short run and in the long run?

A: In the short run there are two types of costs, fixed and variable costs. Since there are fixed and…

Q: A key difference between accountants and economists is their different treatment of the cost of…

A: Any firm main objective is its profit maximization and a firm maximizes its profit by producing at…

Q: In economics, "the long-run" is referred to as a period in which the amounts of capital are…

A: In economics, period (time) is generally divided into 2 parts i.e. short-run period and long-run…

Q: Determine whether each of the statement is true, false, or uncertain. If the statement is false or…

A: The diminishing marginal product of labor is a short-run phenomenon, which explains that after…

Q: Money cost and the real cost don't coincide"? Comment on this statement

A: There are a lot of costs involved while producing a good or service. Some are explicit costs like…

Q: Contrast the concepts diminishing marginal productivity and decreasing returns to scale with…

A: Diminishing Marginal Productivity means with every additional input employed in the production…

Q: which of the following statements about the short-run production is true   A. Total product starts…

A: We have to find true statement of short run production function.

Q: What stage of production is the increase in output that results from increase in a firm's outputs by…

A: When the increase in output that results from increase in a firm's output by some proportion it is…

Q: Draw labeled graph according to the question: The change in the optimal capital-labor ratio if both…

A: If both the inputs(labour and capital) are perfect complements in production, they are to be used…

Q: Y=$10 trillion, K=$10 trillion, L=100 million workers Cobb-Douglas Production Function What is…

A: Production function shows the relationship between the physical output and physical inputs.…

Q: What must an entrepreneur do to earn a profit? How do theactions of firms earning profits influence…

A: Profits are important as they show how productive a company's activities are. Furthermore, profits…

Q: True or false. In general, production can display diminishing returns in all variables but still…

A: Diminishing returns are defined as a decrease in output due to an increase in the input after an…

Q: Consider yourself an owner/manager of a food franchise business. In what situation or circumstances,…

A: Capital budgeting entails selecting projects that increase a company's worth. The capital budgeting…

Q: Y = F(K, L) = A K0.6L0.4 Where Y is aggregate output, A is a measure of available technology, K is…

A: Note: "Sorry" Since you posted two questions with different images, I will do only first part. If…

Q: Please only answer d Consider the following Cobb-Douglas production function: Y = 10 L^0.4 K^0.4.…

A: Answer - Need to find- Effect on the total costs when wage increase from 20 to 30    Given wage Bill…

Q: Q = A Lx Ky  (Quantity, A, Labor, Capital) If A; X; Y are all positive numbers, does the…

A: The production function exhibits Increasing return to scale, Constant return to scale or Decreasing…

Q: Q2. Given a production function Q =f (K, L) = K+ 2L, both capital and labour are doubled, does this…

A: A production function shows the relationship between the inputs used and the output produced in a…

Q: Questions 3. For each of the following production functions, determine whether it exhibits…

A: "In economics, production function indicates the relationship between the factor inputs used in the…

Q: Discuss Factor Abundance, and Economies of Scale In detail.

A: The resources in any economy are limited or scarce. The resources have many alternative uses due to…

Q: When do you think production is on the part of increasing returns on the production function?…

A: Returns to scale is an economic term that defines what happens to long-run returns as production…

Q: Provethatthetechnologyf(L,K)=L2+K2 exhibitsincreasingreturnstoscale. What is the formula for the…

A: Increasing Returns to Scale: When our inputs are increased by m, our output increases by more than…

Q: Marshall assumed a non-corporate business form in his theory about the life cycle of the typical…

A: Unlike Adam Smith, Alfred Marshall avoided dealing with the less than savory aspects of corporate…

Short-Run Costs and Long-Run Costs

Cost of short-run and the long-run is an economic term that describes the cost involved in the production of goods in a firm in the short as well as long period.