6 Cost=C=$12,000.00w=$100.00 per unit of laborr=$100.00 per unit of capitalThese data are used to construct the isocost line (C¹) in the diagram to the right.Suppose the wage increases to $150.00 but that the firm chooses to keep usingthe same amount of labor and capital to produce 200 units of output.Given this new set of factor prices (W = $150.00, r=$100.00), how much havecosts changed if the set of input choices remains at point A? $Enter anumeric response using a real number rounded to two decimal places.)Capital, K240220-200-180-100-x140120100-8060-4020-40tal-20020 40 60 80 100 120 140 100 100 200 220 240Labor, LJOU

The labor force, is the total number of individuals who are as of now employed in addition to the…

Cost-C-$12,000.00 w=$100.00 per unit of labor r-$100.00 per unit of capital wese data are used to construct the isocost line (C¹) in the diagram to the right. ppose the wage increases to $150.00 but that the firm chooses to keep using same amount of labor and capital to produce 200 units of output. wen this new set of factor prices (w-$150.00, r= $100.00), how much have sts changed if the set of input choices remains at point A? $ Enter a meric response using a real number rounded to two decimal places) G Capital, K 220- 200- 180- 100 140 1204 100- 80 00+ 40 204 tal-200 020 40 60 80 100 120 140 160 100 200 220 240 Labor, L

Cost-C-$12,000.00 w=$100.00 per unit of labor r-$100.00 per unit of capital wese data are used to construct the isocost line (C¹) in the diagram to the right. ppose the wage increases to $150.00 but that the firm chooses to keep using same amount of labor and capital to produce 200 units of output. wen this new set of factor prices (w-$150.00, r= $100.00), how much have sts changed if the set of input choices remains at point A? $ Enter a meric response using a real number rounded to two decimal places) G Capital, K 220- 200- 180- 100 140 1204 100- 80 00+ 40 204 tal-200 020 40 60 80 100 120 140 160 100 200 220 240 Labor, L

Microeconomic Theory

12th Edition

ISBN:9781337517942

Author:NICHOLSON

Publisher:NICHOLSON

Chapter10: Cost Functions

Section: Chapter Questions

Problem 10.9P

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se The marginal product of labor can be determined using the total product of labor Production Function curve. 3,500- se Using the equation for the production function, 3,000- 3 2 q= 8LK + 5L2 – 2,500- see the level of output when L= 5 and K= 25 is (Enter a numeric response using 2,000- a real number rounded to two decimal places). 3 1,500- When labor is 5 units and K is 25, the marginal product of labor is 1 1,000 *** When labor increases to 12 units and K is 25, the marginal product of labor is 500 - 12 10 15 Labor Input (L) 15 20 25 DEC 25 tv 20 MacBook Air DII SO F10 F11 F9 F3 F4 * %23 $ & 4 6 8 { } E Y U P D F G н J K > C V N M command option - - ... .- V Product or Output (g) B R
Please only do 4 and 5 not 1 2 or 3 Suppose a firm’s production function is K^1/3 L^2/3 Mpk= L^2/3 / 3K^2/3 MpL=2K^1/3 / 3L^1/3 The rental rate of capital is $52, and the wage rate is $13. What is the cost minimizing capital to labor ratio? How many units of capital and labor should the firm use to produce 1200 units of output How much would it cost the firm to produce 1200 units? What is the short run and long run total costs of decreasing output to 1000 units? Assuming relocation is costless, should the firm relocate to a new location where w=15, r=40?
A firm uses Labour (L) and Capital (K) to produce commodity (Y). The quantities of the inputs and outputs are shown in the table below. L 3 2 90 250 4 5 6. 10 K 90 90 885 90 90 90 90 90 90 90 90 Y 100 420 560 675 760 820 860 900 a. Calculate the average and marginal product of labour and plot them. What economic factors explain the shape of these curves? What is the range of output corresponding to the second stage of production? b. Assuming that the wage rate is Rs.3407- and the rental rate on capital is Rs.0.5/-, calculate the short run average variable cost, marginal cost, average fixed cost, average total cost, total variable cost, total fixed cost and total cost. Plot all these curves. c. Does the average variable cost cuts the marginal cost at the minimum point of the marginal cost? Why is this always the case? What is the relationship between the marginal cost and average variable cost in the second stage of production.
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