A4.1 Suppose that blueberries are produced using land and labor according to the following production function:

Q = L1 + 0.4L 0.5 2

where Q is the number of tons of blueberries harvested, L1 is the number of acres of blueberry fields, and L2 is the number of labor-hours hired.

a. What is the marginal product of land, MP1?

What is the marginal product of labor, MP2?

b. What is the slope of the isoquant curve, dL2>dL1?

c. Suppose that the price of using an acre of land is W1 = $144 and the price of an hour of labor is W2 = $9. What is the slope of the isocost line, dL2>dL1?

d. If the price of using an acre of land is W1 = $144 and the price of an hour of labor is W2 = $9, what is the cheapest combination of land and labor that a firm could employ to produce 10 tons of blueberries?

e. Suppose that the price of land changes so that the price of using an acre of land is W1 = $216 and the price of an hour of labor is W2 = $9.

What is the slope of the isocost line?

f. If the new price of land is W1 = $216 and the price of an hour of labor is W2 = $9, what is the cheapest combination of land and labor that a firm could employ to produce 10 tons of blueberries?