The most efficient scale of production when Q= 65 is to be determined. Concept Introduction: Efficient scale of production : is defined as the point which is the lowest and where the firm (or plant) can produce so that the long run average costs are minimized.

Question

1. Suppose a chair manufacturer is producing in the short run (with its existing plant and equipment). The manufacturer has observed the following levels of production corresponding to different numbers of workers: NUMBER OF WORKERS NUMBER OF CHAIRS 10 2 18 3. 24 4 28 5. 30 28 6. 7 25 a. Calculate the marginal and average product of labor for this production function. b. Does this production function exhibit diminishing returns to labor? c. Explain intuitively what might cause the marginal product of labor to become negative.

Answer 1

Question

Chapter 7, Problem 10P

A

To determine

To Determine:

The most efficient scale of production when Q= 65 is to be determined.

Concept Introduction:

Efficient scale of production: is defined as the point which is the lowest and where the firm (or plant) can produce so that the long run average costs are minimized.

B

To determine

To Determine:

The most efficient scale of production when Q= 75 is to be determined.

Concept Introduction:

Efficient scale of production: is defined as the point which is the lowest and where the firm (or plant) can produce so that the long run average costs are minimized.

C

To determine

To Determine:

The long run average cost is to be traced on the diagram.

Concept Introduction: The long run average cost curve is the lowest cost curve for each output level.

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1. Suppose a chair manufacturer is producing in the short run (with its existing plant and equipment). The manufacturer has observed the following levels of production corresponding to different numbers of workers: NUMBER OF WORKERS NUMBER OF CHAIRS 10 2 18 3. 24 4 28 5. 30 28 6. 7 25 a. Calculate the marginal and average product of labor for this production function. b. Does this production function exhibit diminishing returns to labor? c. Explain intuitively what might cause the marginal product of labor to become negative.

Microeconomics - Production FunctionA firm produces shoes using labor (L) and machinery (K) as factors of production. Its production function is Q = K1/3 * L2/3. Answer:(a) is the marginal product of labor (MPL) decreasing?b) is the average product of labor (APL) decreasing?c) what is the relationship between the average product (AP) and marginal product (MP) curves?d) what type of returns to scale does Q exhibit?

Refer to the graph below: y2 The graph above illustrates a production set of a firm. (a) Which assumption(s) do(es) the production set violates? Explain. (b) Suppose the firm decided to scale all inputs up or down by some amount t > 0. What will happen to the level of output?

Answer 2

Question

Chapter 7, Problem 10P

A

To determine

To Determine:

The most efficient scale of production when Q= 65 is to be determined.

Concept Introduction:

Efficient scale of production: is defined as the point which is the lowest and where the firm (or plant) can produce so that the long run average costs are minimized.

B

To determine

To Determine:

The most efficient scale of production when Q= 75 is to be determined.

Concept Introduction:

Efficient scale of production: is defined as the point which is the lowest and where the firm (or plant) can produce so that the long run average costs are minimized.

C

To determine

To Determine:

The long run average cost is to be traced on the diagram.

Concept Introduction: The long run average cost curve is the lowest cost curve for each output level.

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Answer 3

Question

Chapter 7, Problem 10P

A

To determine

To Determine:

The most efficient scale of production when Q= 65 is to be determined.

Concept Introduction:

Efficient scale of production: is defined as the point which is the lowest and where the firm (or plant) can produce so that the long run average costs are minimized.

B

To determine

To Determine:

The most efficient scale of production when Q= 75 is to be determined.

Concept Introduction:

Efficient scale of production: is defined as the point which is the lowest and where the firm (or plant) can produce so that the long run average costs are minimized.

C

To determine

To Determine:

The long run average cost is to be traced on the diagram.

Concept Introduction: The long run average cost curve is the lowest cost curve for each output level.

Expert Solution & Answer

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Answer 4

Question

Chapter 7, Problem 10P

A

To determine

To Determine:

The most efficient scale of production when Q= 65 is to be determined.

Concept Introduction:

Efficient scale of production: is defined as the point which is the lowest and where the firm (or plant) can produce so that the long run average costs are minimized.

B

To determine

To Determine:

The most efficient scale of production when Q= 75 is to be determined.

Concept Introduction:

Efficient scale of production: is defined as the point which is the lowest and where the firm (or plant) can produce so that the long run average costs are minimized.

C

To determine

To Determine:

The long run average cost is to be traced on the diagram.

Concept Introduction: The long run average cost curve is the lowest cost curve for each output level.

Expert Solution & Answer

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Answer 5

Chapter 7, Problem 10P

A

To determine

To Determine:

The most efficient scale of production when Q= 65 is to be determined.

Concept Introduction:

Efficient scale of production: is defined as the point which is the lowest and where the firm (or plant) can produce so that the long run average costs are minimized.

B

To determine

To Determine:

The most efficient scale of production when Q= 75 is to be determined.

Concept Introduction:

Efficient scale of production: is defined as the point which is the lowest and where the firm (or plant) can produce so that the long run average costs are minimized.

C

To determine

To Determine:

The long run average cost is to be traced on the diagram.

Concept Introduction: The long run average cost curve is the lowest cost curve for each output level.

Answer 6

Chapter 7, Problem 10P

A

To determine

To Determine:

The most efficient scale of production when Q= 65 is to be determined.

Concept Introduction:

Efficient scale of production: is defined as the point which is the lowest and where the firm (or plant) can produce so that the long run average costs are minimized.

Answer 7

Chapter 7, Problem 10P

A

To determine

To Determine:

The most efficient scale of production when Q= 65 is to be determined.

Concept Introduction:

Efficient scale of production: is defined as the point which is the lowest and where the firm (or plant) can produce so that the long run average costs are minimized.

Answer 8

B

To determine

To Determine:

The most efficient scale of production when Q= 75 is to be determined.

Concept Introduction:

Efficient scale of production: is defined as the point which is the lowest and where the firm (or plant) can produce so that the long run average costs are minimized.

Answer 9

B

To determine

To Determine:

The most efficient scale of production when Q= 75 is to be determined.

Concept Introduction:

Efficient scale of production: is defined as the point which is the lowest and where the firm (or plant) can produce so that the long run average costs are minimized.

Answer 10

C

To determine

To Determine:

The long run average cost is to be traced on the diagram.

Concept Introduction: The long run average cost curve is the lowest cost curve for each output level.

Answer 11

C

To determine

To Determine:

The long run average cost is to be traced on the diagram.

Concept Introduction: The long run average cost curve is the lowest cost curve for each output level.

Answer 12

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Answer 13

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Ch. 7 - Prob. 1P Ch. 7 - Prob. 2P Ch. 7 - Prob. 3P Ch. 7 - Prob. 4P Ch. 7 - Prob. 5P Ch. 7 - Prob. 6P Ch. 7 - Prob. 7P Ch. 7 - Prob. 8P Ch. 7 - Prob. 9P Ch. 7 - Prob. 10P

The most efficient scale of production when Q= 65 is to be determined. Concept Introduction: Efficient scale of production : is defined as the point which is the lowest and where the firm (or plant) can produce so that the long run average costs are minimized.

Concept explainers

To Determine:

The most efficient scale of production when Q= 65 is to be determined.

Concept Introduction:

Efficient scale of production: is defined as the point which is the lowest and where the firm (or plant) can produce so that the long run average costs are minimized.

To Determine:

The most efficient scale of production when Q= 75 is to be determined.

Concept Introduction:

Efficient scale of production: is defined as the point which is the lowest and where the firm (or plant) can produce so that the long run average costs are minimized.

To Determine:

The long run average cost is to be traced on the diagram.

Concept Introduction: The long run average cost curve is the lowest cost curve for each output level.

Chapter 7 Solutions

The most efficient scale of production when Q= 65 is to be determined. Concept Introduction: Efficient scale of production : is defined as the point which is the lowest and where the firm (or plant) can produce so that the long run average costs are minimized.

Concept explainers

To Determine: The most efficient scale of production when Q= 65 is to be determined. Concept Introduction: Efficient scale of production: is defined as the point which is the lowest and where the firm (or plant) can produce so that the long run average costs are minimized.

To Determine: The most efficient scale of production when Q= 75 is to be determined. Concept Introduction: Efficient scale of production: is defined as the point which is the lowest and where the firm (or plant) can produce so that the long run average costs are minimized.

To Determine: The long run average cost is to be traced on the diagram. Concept Introduction: The long run average cost curve is the lowest cost curve for each output level.

Chapter 7 Solutions

To Determine:

The most efficient scale of production when Q= 65 is to be determined.

Concept Introduction:

Efficient scale of production: is defined as the point which is the lowest and where the firm (or plant) can produce so that the long run average costs are minimized.

To Determine:

The most efficient scale of production when Q= 75 is to be determined.

Concept Introduction:

Efficient scale of production: is defined as the point which is the lowest and where the firm (or plant) can produce so that the long run average costs are minimized.

To Determine:

The long run average cost is to be traced on the diagram.

Concept Introduction: The long run average cost curve is the lowest cost curve for each output level.