🏷️ LIMITED TIME OFFER: GET 20% OFF GRADE+ YEARLY SUBSCRIPTION →
Log in
Economics
2
answers
0
watching
254
views

A firm’s production function is given by f(x1,x2) = (1/2) x11/5 x24/5. Assume that the markets for the input factors are competitive. The market prices for input factor 1 and input factor 2 are given by p1 = 1 and p2 = 8 respectively. Find the optimum amount of x1 and x2.

Watch
2
answers
0
watching
254
views

For unlimited access to Homework Help, a Homework+ subscription is required.

Unlock all answers

Get 1 free homework help answer.
Already have an account? Log in
Share
Yusra Anees
Yusra AneesLv10
9 Apr 2021
Already have an account? Log in
Share

Related textbook solutions

Principles of Economics
2nd Edition, 2017
Openstax
ISBN: 9781947172364
Principles of Macroeconomics
2 Edition,
Openstax
ISBN: 9781947172388
Principles of Microeconomics
2 Edition,
Openstax
ISBN: 9781947172340

Related questions

Question 1

A utility function is given by u(x1, x2) = min{x1 + 2x2, 3x1 + x2}.

(a) Graphically determine the optimal consumption for the following prices and income: p1 =1, p2 =1,I =30.

(b) Suppose the price of good 2 increases to p2 = 3. Determine graphically the change in consumption of goods 2 and 3. p1 = 1, p2 = 2, I = 20.

(c) Determine the least costly consumption bundle which gives the consumer the same utility as in (b) when prices are p1 = 1, p2 = 1, i.e.

Determine the Hicksean demand.

- Essay Question:

Assume a firm uses two inputs in its production process: labour and capital. Using isocost and isoquant analysis, examine the possible effects of an increase in wage on the firm’s

(a) use of labour and capital

(b) long-run total and average costs.

- Problem Question:

a) Derive the cost minimizing input demands and the long-run total cost function for the following production functions assuming input prices w1 and w2:

(i) y = f(x1, x2) = 2x1 + x2

(ii) y = min(x1, 3x2)

b) For each of the production functions above, determine the short-run input demands and short run total cost function when input 2 is limited to x2 = 100 units

 Consider a firm whose technology is given by the production function: y = f (K,L) = (N+1)L + 2√K. Assume that input prices for labour, L, and capital, K, are w = 1 and r = 2 respectively. a)Find the firm’s short run total cost function assuming the firm cannot hire more workers nor fire its only worker, i.e. L = 1 is fixed. 

b)Find the firm’s short run marginal cost, average variable cost and average fixed cost. Draw the three of them in the same graph. What is the short-run supply of the firm?

c)Find the firm’s long run total cost function, i.e. when all factors are variable. 

d)Find the firm’s long run marginal cost and average cost. Draw them in the same graph. What is the long-run supply of the firm?

Weekly leaderboard

Home
Homework Help 3,900,000
Economics 400,000
Start filling in the gaps now
Log in