Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

A company has a fixed 32 unit of capital the production function of the company is Q=45K^0.45 L^0.55. Both the output and input markets are

A company has a fixed 32 unit of capital the production function of the company is Q=45K^0.45 L^0.55. Both the output and input markets are perfectly competitive the labor market is in equilibrium the demand function of labor is DL=1480-7.8P_L. the supply function of labor is SL=198+6.6P_L. the price of the service provided by the company is 75. Every unit of the capital cost 1890. Compute the quantity of labor used Compute the level of output Compute the profit of the company

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Principles of Macroeconomics

Authors: Karl E. Case, Ray C. Fair, Sharon E. Oster

12th edition

134078802, 978-0134078809

More Books

Students also viewed these Economics questions