Question 47 Profit maximization implies that firms will want to accumulate labor while the MPK is greater than the rental price of capital accumulate capital while the MPL is greater than the real wage accumulate labor while the MPL is greater than the real wage accumulate capital while the MPK is lower than the rental price of capital none of the above

Question 47 Profit maximization implies that firms will want to accumulate labor while the MPK is greater than the rental price of capital accumulate capital while the MPL is greater than the real wage accumulate labor while the MPL is greater than the real wage accumulate capital while the MPK is lower than the rental price of capital none of the above

Exploring Economics

8th Edition

ISBN:9781544336329

Author:Robert L. Sexton

Publisher:Robert L. Sexton

Chapter16: The Markets For Labor, Capital, And Land

Section: Chapter Questions

Problem 16P

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Suppose that labor is the only input used by aperfectly competitive firm. The firm’s productionfunction is as follows:Days of Labor Units of Output0 days 0 units1 72 133 194 255 286 297 29a. Calculate the marginal product of each additionalworker.b. Each unit of output sells for $10. Calculate thevalue of the marginal product of each worker.c. Compute the demand schedule showing thenumber of workers hired for all wages from zeroto $100 a day.d. Graph the firm’s labor-demand curve.e. What happens to this demand curve if the price ofoutput rises from $10 to $12 per unit?
In the context of a perfectly competitive model of the labour market, an increase in technologythat raises the marginal product of labour at any given level of employment would be expected, inequilibrium, toa) reduce the amount of labour required to produce a given amount of output and hence increaseunemployment.b) shift the labour demand curve outwards and lead to an increase in employment and wages.c) have no effect upon labour supply or labour demand curves and hence have no impact onemployment or wages.d) reduce the supply of labour to the market and result in an increase in wages but a fall inemployment Why the correct answer is B?
please sir solve these 3 questions 33- If an increase in the price of one good leads to a fall in the quantity demanded of other than these goods are complementry good A- True B- False 34- the production function is a purely technical relationship between input and output A- True B- False 35- marginal proudact is defined as the change in TP resulting from the employment of an additional unit of a varibal factor: A- True B- False
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Y5 If a firm uses n inputs (n > 2), what inequality does the theory of revealed cost mini- mization imply about changes in factor prices (∆wi) and the changes in factor demands (∆xi) for a given level of output?
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It deals with the Production Function, Marginal Rate of Technical Subsition . Problem: The Production Function for a Product is given by q=10 K ^1/2 L^1/2 where K is capital and L is Labor and q is output . 1a. Find the Marginal Product of labor and the Marginal Product of Capital 1b. Find the Marginal Rate Of Technical Substitution between Labor and Capital 1c. Denote the wage of Labor by w and the renal of cpaital by r . What is thre cost of the minization condition for a firm . Show it digrammatically.
Explain how the wage can adjust to balance thesupply and demand for labor while simultaneouslyequaling the value of the marginal product oflabor.
Selected answer will be automatically saved. For keyboard navigation, press up/down arrow keys to select an answer. a by drawing an average cost curve in which capital is variable but labor is fixed at the largest amount the firm can hire b by assuming the firm is minimizing total costs at all levels of output n d by finding the lowest average cost of producing any level of output, assuming all inputs can be varied How is the LRAC derived? by finding the largest amount of capital the firm can afford to use, and viewing the output capabilities of that capital amount Selected answer will be automatically saved. For keyboard navigation, press up/down arrow keys to select an answer. a b C by drawing an average cost curve in which capital is variable but labor is fixed at the largest amount the firm can hire by assuming the firm is minimizing total costs at all levels of output by finding the largest amount of capital the firm can afford to use, and viewing the output capabilities of that…
During the 1920s, Charles Cobb and Paul Dougkas modeled totalproduction output P (of a firm, company or entire economy) as a function of labourhours involved x and capital invested y (each includes the monetary worth of allbuildings and equipment). The Cobb-Douglas production function isP(x, y) = k x^α y^(1−α),where k ad α are constants representative of a particular firm or economy.(1) Show that doubling of both labor and capital results in doubling productionP.(2) Suppose a particular firm has the production function for k = 120 andα =3/4. Assume each unit of labor costs $250 and each unit of capital costs$400, and that the total expense for all costs cannot exceed $100,000. Findthe maximum production level for the firm.(3) Compute the production level at x = 64 and y = 81. If the capital isdecreased by 3 units, by how many units the labor should be adjusted toso that there is not change in production level.