question
suppose the marginal product of labor is 8 and the marginal product of capital is 2. if the wage rate is $4 and the price of capital is $2, then in order to minimize costs the firm should:
answer
more labor and less capital
question
Suppose the production function is given by Q = 3K + 4L. What is the average product of capital when 5 units of capital and 10 units of labor are employed?
answer
11
question
You are an efficiency expert hired by a manufacturing firm that uses K and L as inputs. The firm produces and sells a given output. If w = $40, r = $100, MPL = 4, and MPK = 40 the firm:
answer
Should use more K and less L to cost minimize
question
The feasible means of converting raw inputs such a steel labor and machinery into an output are summarized by
answer
Technology
question
What is the average product of labor given that the level of labor equals 10, total output equals 1200, and the marginal product of labor equals 200
answer
120
question
For managers should use inputs at levels where the
answer
Marginal benefit equals marginal cost and value marginal product of labor equals wage
question
The production function is Q=K^6L^4. The marginal rate of technical substitution is
answer
2/3K L^-1
question
Fixed costs exist only in
answer
short run
question
Which curve(s) does the marginal cost curve intersect at the (their) Minimum point?
answer
Average total cost curve and average variable cost curve
question
which of the following cost functions exhibit cost complementarity?
answer
-4Q1Q2. + 8Q1
question
The long run is defined as:
answer
The horizon in which the manager can adjust all factors of production
question
The manager institutes an incentive structure to ensure
answer
The firm produces on the production function
question
The average product of labor depends on how many units of:
answer
Labor and capital are used
question
An isocost line
answer
Represents the combinations of K and L that cost the firm the same amount of money
question
when there are economies of scope between products, selling off an Unprofitable subsidiary could lead to
answer
Only a minor reduction in cost
question
Supposed to marginal product of labor is 10 and the marginal product of capital is 8. If the wage rate is $5 and the price of capital is $2, then in order to minimize costs the firm should use:
answer
More capital and less labor
question
which of the following conditions is true when a producer Minimize the cost of producing a given level of output?
answer
The marginal product per dollar spent on all inputs is equal
question
suppose that production for good X is characterized by the following production function, Q=K0.5L0.5, where K is the fixed input in the short run. If per unit rental rate of capital, r, is $25 And the per unit wage, W, is $15, then the average total cost of using 81 units of capital and nine units of labor is:
answer
$80
question
suppose the production for good X is characterized by the following production function, Q=K0.5L0.5, where K Is the fixed input in the short run. If the per-unit rental rate of capital, or, is $15 and the per unit wage, W, is $5, Then the average fixed cost of using 16 units of capital and 25 units of labor is:
answer
$12
question
Suppose the production function is given by Q = 3K + 4L. What is the average product of capital when 10 units of capital and 10 units of labor are employed?
answer
3
question
For the cost function C(Q) = 100 + 2Q + 3Q2, the marginal cost of producing 2 units of output is
answer
16
question
For the cost function C(Q) = 100 + 2Q + 3Q2, the marginal cost of producing 10 units of output is
answer
10
question
What is the value marginal product of labor if: P= $10, MPL=$25, and APL=40
answer
$250
question
According to the table below what is the marginal cost of production 90 units of output?
answer
8.75
question
The marginal product of an input is defined as the change in:
answer
Total output attributable to the last unit of an input
question
if the marginal product per dollar spent on capital is less than the marginal product per dollar spent on labor, Then in order to minimize costs the firm should use:
answer
less capital and more labor.
question
cost complementarity exists in a multiproduct cost function when:
answer
The marginal cost of producing one output is reduced when the output of another product is increased
question
The point where diminishing marginal returns has begun to affect production is best characterized by the point where the:
answer
marginal product curve begins to be negatively sloped.
question
suppose the w=$20 and r=$30. the isocost line for a firm in this industry is:
answer
K = 0.033C - 0.66L
question
The production function in the table below exhibits decreasing marginal returns to capital over what output range
answer
between 2391 and 3048
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