EBK INTERMEDIATE MICROECONOMICS AND ITS
12th Edition
ISBN: 9781305176386
Author: Snyder
Publisher: YUZU
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Question
Chapter 7.6, Problem 2.1MQ
To determine
To find the way in which MD’s cost depends on the firm’s ability to substitute capital for labor.
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Students have asked these similar questions
Does additional input of labor entail a steady increase in the output of a firm? Why or Why not?
A firm produces output according to a production function:
Q = F(K,L) = min {4K,4L).
a. How much output is produced when K= 2 and L = 1?
unit(s)
b. If the wage rate is $60 per hour and the rental rate on capital is $40 per hour, what is the cost-minimizing input mix for producing 8
units of output?
Capital:
Labor:
c. How does your answer to part b change if the wage rate decreases to $40 per hour but the rental rate on capital remains at $40 per
hour?
O Capital decreases and labor increases.
O It does not change.
O Capital increases and labor decreases.
O Capital and labor increase.
Explain why an increase in the price of an input must typically cause an increase in the long-run total cost of producing any particular level of output.
Chapter 7 Solutions
EBK INTERMEDIATE MICROECONOMICS AND ITS
Ch. 7.1 - Prob. 1MQCh. 7.1 - Prob. 2MQCh. 7.1 - Prob. 1TTACh. 7.1 - Prob. 2TTACh. 7.2 - Prob. 1MQCh. 7.2 - Prob. 2MQCh. 7.2 - Prob. 1TTACh. 7.2 - Prob. 2TTACh. 7.3 - Prob. 1MQCh. 7.3 - Prob. 2MQ
Ch. 7.3 - Prob. 3MQCh. 7.3 - Prob. 1TTACh. 7.3 - Prob. 2TTACh. 7.5 - Prob. 1TTACh. 7.5 - Prob. 2TTACh. 7.6 - Prob. 1MQCh. 7.6 - Prob. 2MQCh. 7.6 - Prob. 3MQCh. 7.6 - Prob. 1.1MQCh. 7.6 - Prob. 2.1MQCh. 7 - Prob. 1RQCh. 7 - Prob. 2RQCh. 7 - Prob. 3RQCh. 7 - Prob. 4RQCh. 7 - Prob. 5RQCh. 7 - Prob. 6RQCh. 7 - Prob. 7RQCh. 7 - Prob. 8RQCh. 7 - Prob. 9RQCh. 7 - Prob. 10RQCh. 7 - Prob. 7.1PCh. 7 - Prob. 7.2PCh. 7 - Prob. 7.3PCh. 7 - Prob. 7.4PCh. 7 - Prob. 7.5PCh. 7 - Prob. 7.6PCh. 7 - Prob. 7.7PCh. 7 - Prob. 7.8PCh. 7 - Prob. 7.9PCh. 7 - Prob. 7.10P
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- The economist for the ABC Truck Manufacturing Corporation has calculated a production function for the manufacture of their medium-size trucks as follows: Q = 1.3 * (L0.75) * (K0.3) Where Q is the number of trucks produced per week, L is the number of labor hours per day and K is the daily usage of capital investment. Calculate the marginal product of labor and marginal product of capital using the below data? Labor Capital 100 50 120 60 150 75 200 100 300 150arrow_forwardEconomics A firm has the production function q = K0.25L0.25 , where K is capital, L is labor, and q is output. The price of capital is v = 4 and the price of labor is w = 4. [You may need this result: if Yα = Z. Then Y = Z1/α]. (i) Derive the firm’s short-run cost function if capital is fixed at K = 16. (ii) Derive the firm’s long-run cost function. (iii) Someone claims that the firm’sarrow_forwardIn the short-run, we assume that capital is a fixed input and labor is a variable input, so the firm can increase output only by increasing the amount of labor it uses. In the short-run, the firm's production function is q = f(L,K), q = 6LK + 7L2 – where g is output, Lis workers, and K is the fixed number of units of capital. What is the marginal product of labor as a function of L and K? MP, =. (Properly format your expression using the tools in the palette. Hover over tools to see keyboard shortcuts. E.g., a superscript can be created with the ^ character.) For example, if L = 5 and K= 23, then the marginal product of labor equals MP, =. (Enter a numeric response using an integer.) If L=9 and K= 23, then the marginal product of labor equals MP, =. (Enter a numeric response using an integer.) 20 tv MacBook Air S0 F2 F3 F4 % & 4 6 { E R Y P F G J K > C V M command option レ .. .- V * C B *3arrow_forward
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