Consider the production function Q = 100L.5K.4. Suppose L = 1 and K = 1 so that
Question:
a. If L is increased by 1 percent, that is, to L = 1.01, with capital unchanged, what is the resulting percentage increase in output?
b. Describe the nature of returns to scale for this production function.
Fantastic news! We've Found the answer you've been seeking!
Step by Step Answer:
Answer rating: 57% (14 reviews)
a Q 100101 5 1 1005 Output increases by 5 In general the power co...View the full answer
Answered By
Mugdha Sisodiya
My self Mugdha Sisodiya from Chhattisgarh India. I have completed my Bachelors degree in 2015 and My Master in Commerce degree in 2016. I am having expertise in Management, Cost and Finance Accounts. Further I have completed my Chartered Accountant and working as a Professional.
Since 2012 I am providing home tutions.
3.30+
2+ Reviews
10+ Question Solved
Related Book For
Managerial economics
ISBN: 978-1118041581
7th edition
Authors: william f. samuelson stephen g. marks
Question Posted:
Students also viewed these Economics questions
-
Consider the production function Q = 10L -.5L2 + 24K - K2 for L and K in the range 0 to 10 units. Does this production function exhibit diminishing returns to each input? Does it exhibit decreasing...
-
Suppose that for the production function q = f( L, K), if L = 3 and K = 5 then q = 10. Is it possible that L = 3 and K = 6 also yields q = 10 for this production function? Why or why not?
-
A firm produces an output with the production function Q = KL, where Q is the number of units of output per hour when the firm uses K machines and hires L workers each hour. The marginal products for...
-
In Exercises, find the limit. lim (4x- x 16x - x
-
What is a biological control agent? Briefly describe two examples.
-
Records at Hal's Accounting Services show the following costs for year 1 $ Direct materials and supplies Employee costs Total overhead 49,000 2,900,000 1,350,000 Production was 35,000 billable hours....
-
E 7-10 Parent purchases subsidiary bonds issued on par Lana DD was the parent company of Noa DD, acquired in 2011. Lana DD owned 90 percent interest in Noa DD. On January 1, 2013, Noa DD issued...
-
The following gives the number of pints of type A blood used at Woodiawn Hospital in the past 6 weeks: Week Of Pints Used August 31 ......... 360 September 7 ........ 389 September 14 ......... 410...
-
Concord Corporation purchased a delivery van with a $69000 list price. The company was given a $6800 cash discount by the dealer, and paid $2800 sales tax. Annual insurance on the van is $1500. As a...
-
In 2012, George wright started the Old Oregon Wood Store to man-ufacture Old Oregon tables. Each table is carefully constructed by hand using the highest- quality oak. Old Oregon tables can support...
-
A firm is producing a given amount of output at least cost using a mix of labor and capital (which exhibit some degree of substitutability). Using an isoquant graph, show that if one input price...
-
In her last-minute preparations for final exams, a student has set aside five hours to split between studying for two subjects, finance and economics. Her goal is to maximize the average grade...
-
Aromatic compounds react with a mixture of nitric and sulfuric acid to form aromatic compounds containing a nitro (NO 2 ) group. Two isomeric compounds are formed by nitration of 1,2-dimethylbenzene....
-
CASE 7.2 Oracle Corporation: Share-Based Compensation Effects/Statement of Shareholders' Equity A sales-based ranking of software companies provided by Yahoo! Finance on November 5, Year 8, places...
-
A manufacturer of ovens sells them for $1,450 each. The variable costs are $800 per unit. The manufacturer's factory has annual fixed costs of $1,735,000. a. Given the expected sales volume of 3,100...
-
1.1 Explain the vitality of a strategy on businesses like Dell. (15) 1.2 Critically discuss the underlying objectives Dell should follow when formulating its business strategy. (20) 1.3 Discuss the...
-
Our international business plan involves exporting a sustainable apparel brand from India to UK. We will be exploring this plan in further detail below: Product/ Service: Sustainable clothing line...
-
If X is a random variable with probability density function f given by: f (x) = 4x 4x 3 when 0 x 1 and 0 otherwise, compute the following quantities: (a) The cumulative distribution function F...
-
Suppose the risk-free return is 3% and you measure the market risk premium to be 6%. Apple has a beta of 1.2. According to the CAPM, what is its expected return?
-
Research an article from an online source, such as The Economist, Wall Street Journal, Journal of Economic Perspectives, American Journal of Agricultural Economics, or another academic journal. The...
-
Explain how you would undertake (i) a choice experiment and (ii) a travel-cost study of the benefits of improved management of a national park. What information could such studies generate that would...
-
Provide a real-world example of a market that approximates each oligopoly setting, and explain your reasoning. a. Cournot oligopoly. b. Stackelberg oligopoly. c. Bertrand oligopoly.
-
Two firms compete in a market to sell a homogeneous product with inverse demand function P = 400 2Q. Each firm produces at a constant marginal cost of $50 and has no fixed costs. Use this...
-
Consider a homogeneous-product duopoly where each firm initially produces at a constant marginal cost of $100 and there are no fixed costs. Determine what would happen to each firms equilibrium...
-
Deacon Company is a merchandising company that is preparing a budget for the three - month period ended June 3 0 th . The following information is available Deacon Company Balance Sheet March 3 1...
-
Mango Company applies overhead based on direct labor costs. For the current year, Mango Company estimated total overhead costs to be $460,000, and direct labor costs to be $230,000. Actual overhead...
-
Which of the following do we expect to be the horizon growth rate for a company (long term growth rate- say 30-50 years)? A) Inflation B) Industry Average C) Zero D) Market Beta
Study smarter with the SolutionInn App