EBK INTERMEDIATE MICROECONOMICS AND ITS
12th Edition
ISBN: 9781305176386
Author: Snyder
Publisher: YUZU
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Question
Chapter 6, Problem 6RQ
a.
To determine
To Evaluate:Miss M’s answer on her micro examination using fixed proportions production function.
b.
To determine
To Evaluate:Miss M’s answer on her micro examination using a Cobb Douglas production function.
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Consider the following production function of DVDS: Q = K0.5L 0.5, where Q represents DVDS
(boxes per hour), K denotes capital input (units per hour), and L denotes labour input (units of
worker time per hour). The unit cost of capital and labour are $40 and $20, respectively.
a) What is the optimal input ratio of labour and capital for the production?
b) Determine the appropriate input mix to produce 800 boxes of DVDS. Compute the cost of
production.
c) Suppose the government decided to offer a subsidy that would make the cost of labour $15.
What is the optimal input mix to produce the same level of output, and the new cost of
production? Also, compute the substitution effect in the employment of labour.
Suppose a firm is producing computer monitors utilizing the following technology: Q=F(K,L)=L1/3K2/3
Q – weekly output L – labor hours K – hours of capital use
Would the firm with the above production function be able to produce monitors using only capital (no labor)? Explain.
QUESTION 12: Let the production function be as follows
Q = K²/3L1/3
Find the cost-minimizing level of K and L that costs C=500 when w=1, r=2
Chapter 6 Solutions
EBK INTERMEDIATE MICROECONOMICS AND ITS
Ch. 6.2 - Prob. 1TTACh. 6.2 - Prob. 2TTACh. 6.2 - Prob. 1MQCh. 6.2 - Prob. 2MQCh. 6.3 - Prob. 1TTACh. 6.3 - Prob. 2TTACh. 6.3 - Prob. 1MQCh. 6.3 - Prob. 2MQCh. 6.4 - Prob. 1TTACh. 6.4 - Prob. 2TTA
Ch. 6.5 - Prob. 1MQCh. 6.5 - Prob. 2MQCh. 6.5 - Prob. 3MQCh. 6.6 - Prob. 1TTACh. 6.6 - Prob. 2TTACh. 6.7 - Prob. 1MQCh. 6.7 - Prob. 2MQCh. 6.7 - Prob. 3MQCh. 6.7 - Prob. 4MQCh. 6 - Prob. 1RQCh. 6 - Prob. 2RQCh. 6 - Prob. 3RQCh. 6 - Prob. 4RQCh. 6 - Prob. 5RQCh. 6 - Prob. 6RQCh. 6 - Prob. 7RQCh. 6 - Prob. 8RQCh. 6 - Prob. 9RQCh. 6 - Prob. 10RQCh. 6 - Prob. 6.1PCh. 6 - Prob. 6.2PCh. 6 - Prob. 6.3PCh. 6 - Prob. 6.4PCh. 6 - Prob. 6.5PCh. 6 - Prob. 6.6PCh. 6 - Prob. 6.7PCh. 6 - Prob. 6.8PCh. 6 - Prob. 6.9PCh. 6 - Prob. 6.10P
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