Hey! I would appreciate some help with this. Have an exam around the corner and I would like to make sure I understand this part. Thank you so much!
PO AccessUH X Bb Homework 5 - 2020 x S hw5.pdf X Homework Help - Q& x C Get Homework Help X G how to screenshot in X + X -> C @ File | /home/chronos/u-91063b33a289d446922f0b326b7a9be15faaaa4b/MyFiles/Downloads/hw5.pdf G C 1. A basic assumption of the short run is that a firm: A. can freely adjust the amount of labor and capital that it employs. B. can reduce the number of workers it uses, but it cannot adjust how much capital it uses. C. can employ more workers and add more capital to the production process. D. cannot adjust its workforce or the amount of capital it uses. Gasoline is a luxury good. 2. Which situation will likely give rise to diminishing marginal product of labor? A. Hell's Kitchen, which has enough counter space for three cooks per shift, decides to hire a fourth cook per shift. B. A landscaping firm replaces all of its self-propelled lawnmowers with push mowers. C. Plasma television manufacturers are going out of business because of increased competition from LCD televisions. D. Nevaeh's Kitchen undertakes a massive expansion, doubling both the size of its kitchen and number of cooks. 3. In the short run, the marginal product of labor: A. is always diminishing. B. continues to increase so long as the firm adds labor slowly. C. will eventually fall. D. always increases because laborers become more efficient with experience. 4. In the long run, because firms can adjust both capital and labor: A. production is more expensive because firms must invest in both labor and capital. B. firms will grow.PO AccessUH X Bb Homework 5 - 2020 x S hw5.pdf X *Homework Help - Q& x C Get Homework Help X G how to screenshot in X + X -> C @ File | /home/chronos/u-91063b33a289d44b922f0b326b7a9be15faaaa4b/MyFiles/Downloads/hw5.pdf G C B. firms will grow. C. firms fire workers, replacing the labor productivity with capital. D. the impact of diminishing marginal returns is lessened. 5. Which of the following statements is (are) TRUE? I. If labor and capital are perfect substitutes in production, the isoquant is a downward- sloping line. II. If a company needs to use inputs in fixed proportion such that the capital to labor ratio is always 2, the firm's isoquants are L-shaped. III. If the production function is given by Q = min(14, 7), the firm can produce, at minimum, 21 units of output. A. I and II B. I, II and III C. I D. IIIPO AccessUH X Bb Homework 5 - 2020 x S hw5.pdf X *Homework Help - Q& x C Get Homework Help X G how to screenshot in X + X -> C @ File | /home/chronos/u-91063b33a289d446922f0b326b7a9be15faaaa4b/MyFiles/Downloads/hw5.pdf G C 6. Which of the following statements best exemplifies the firm's constrained minimization problem? A. The firm desires to produce a given quantity of output by choosing values of W and R that minimize RK + WL. B. The firm desires to produce a given quantity of output by choosing values of L and K that minimize RK + WL. C. The firm desires to produce as much output as possible by choosing values of L and K that minimize RK + WL. D. The firm desires to produce as much output as possible subject to the constraint that C = RK + WL. 7. This table illustrates a .......... production function because capital and labor Units of Capital, Units of Labor, L K 1 2 3 4 AWN- 50.0 56.7 75.5 80.0 66.7 100.0 120.0 133.3 75.0 120.0 150.0 171.4 80.0 133.3 171.4 200.0 A. short-run; are used in equal increments B. long-run; can both be varied C. long-run; are used in equal increments D. short-run; can both be variedPO AccessUH X Bb Homework 5 - 2020 x S hw5.pdf X Homework Help - Q& x C Get Homework Help X G how to screenshot in X + X -> C @ File | /home/chronos/u-91063b33a289d446922f0b326b7a9be15faaaa4b/MyFiles/Downloads/hw5.pdf G C 8. Suppose a firm's short-run production function is given by Q = 16108 . What is the marginal product of the fourth worker? 9. What is the average product at L = 2 and at L = 8? Output (@) 10- 9- Production function 8- 9 10 Labor 10. Suppose the wage rate is $25 per hour and the rent on capital is $50 per hour. What is the equation for the isocost line? 11. Suppose that a firm faces the production function Y = K * L and is currently mini- mizing costs in the long run with marginal product of labor and marginal product of capital given by K and L, respectively. If the price of capital falls by 50%, what will be the percentage change in the capital-to-labor ratio? 12. Suppose a firm is producing 2,475 units of output by hiring 50 workers (W = $20 per hour) and 25 units of capital (R = $10 per hour). The marginal product of labor and marginal product of capital are 40 and 25, respectively. Is the firm minimizing the cost of producing 2,475 units of output? If not, what should it change
