[solution] »

A firm has the following short-run production function (where L = Labor and Q = Output):

Q

Description

Answer Download

The Question

A firm has the following short-run production function (where L = Labor and Q = Output):

Q = 10L ? 0.5L²

Suppose that the output can be sold for $10 per unit. Further assume that the firm can obtain as much of the variable input (L) as it needs at $20 per unit.

a) Determine the marginal revenue function (5 points)

b) Determine the value of L that maximizes profits (5 points)

A company uses two variable inputs, labor (L) and materials (M), to produce its output. At the company?s current level of output:

C_L = $10 / unit                  MP_L = 25

C_M = $2 / unit                   MP_M = 4

a) Determine whether the firm is operating efficiently, given that its objective is to minimize the cost of producing the given the level of output (5 points)

b) Determine what changes (if any) in the relative proportions of labor and materials are needed to operate efficiently (5 points)

A company has a cost structure described in the table below. Using your knowledge of the types of costs involved in a production process, fill in the blanks in the table.

Quantity produced	Total Cost	Total Fixed Cost	Total Variable Cost	Average Total Cost	Average Fixed Cost	Average Variable Cost	Marginal Cost
0	100	0	-	-	-	-
1	160
2	80
3	65
4	10
5	120
6	40
7	180
8	30
9	421
10	100

 

About this Question

STATUS

Answered

QUALITY

Approved

DATE ANSWERED

Sep 21, 2019

EXPERT

Tutor

ANSWER RATING

BEST TUTORS

We have top-notch tutors who can do your essay/homework for you at a reasonable cost and then you can simply use that essay as a template to build your own arguments.

You can also use these solutions:

• As a reference for in-depth understanding of the subject.
• As a source of ideas / reasoning for your own research (if properly referenced)
• For editing and paraphrasing (check your institution's definition of plagiarism and recommended paraphrase).

This we believe is a better way of understanding a problem and makes use of the efficiency of time of the student.

STUCK WITH YOUR PAPER?

Order New Solution. Quick Turnaround

Click on the button below in order to Order for a New, Original and High-Quality Essay Solutions. New orders are original solutions and precise to your writing instruction requirements. Place a New Order using the button below.

WE GUARANTEE, THAT YOUR PAPER WILL BE WRITTEN FROM SCRATCH AND WITHIN A DEADLINE.