A4.4 Roses Roses is a local flower shop specializing in rose bouquets for weddings. Rose can produce

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A4.4 Rose’s Roses is a local flower shop specializing in rose bouquets for weddings. Rose can produce her magnificent bouquets using roses imported from Colombia or roses imported from Ecuador. Due to altitude and Ecuador’s location on the equator, the Ecuadorean roses are slightly larger, meaning Rose needs fewer of them to produce each bouquet. Rose produces her bouquets according to the following production function:

Q = 0.05RC + 0.25RE where Q is the quantity of bouquets produced and RC and RE are the quantities of Colombian roses and Ecuadorian roses used, respectively. The price of a Colombian rose is PC = $0.35, and the price of an Ecuadorian rose is PE = $0.35.

a. Referring to the production function given above, what is the slope of the isoquant line, dRE>dRC?

b. What is the slope of the isocost line, dRE>dRC?

c. Based on your answers to parts a and

b, how many Colombian roses and how many Ecuadorian roses will Rose use in each of her magnificent bouquets?

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