An isoquant curve for producing a 10 lb bag of wheat is given as below. What is theMarginal Rate of Technical Substitution (MRTS) at a point (L, K)=(2,9)?15Capital141, 14119TELEUR876543210-4-34312,93,543526,1.5234567Labor

The objective of the question is to calculate the Marginal Rate of Technical Substitution (MRTS) at…

Answered: An isoquant curve for producing a 10 lb…

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

See similar textbooks

Similar questions

What is the marginal effect of experience if a baseball player has 5 years of experience? Call: lm(formula Salary = Residuals: Min 1Q Median Max 3Q -7596287 -2108665 -462907 1582398 21522851 Coefficients: HR R (Intercept) -1820768 Experience ExperSq --- Estimate Std. Error t value Pr(>ltl) 845,369 Experience + ExperSq+ HR + R, data = Baseball_for_R) 845369 -23846 93232 31963 Signif. codes: 0*** 0.001 **' 0.01 * 0.05 0.1' -23,846 Residual standard error: 3451000 on 406 degrees of freedom Multiple R-squared: 0.4736, Adjusted R-squared: 0.4684 F-statistic: 91.3 on 4 and 406 DF, p-value: < 2.2e-16 606,909 359743 -5.061 6.32e-07 *** 7.066 6.98e-12 *** 119636 8236 -2.895 0.003994 ** 26782 3.481 0.000553 *** 8645 3.697 0.000248 *** 3,630,695 1
E. A firm has the production function f(T1, 12) = 1750 , 50 What is the marginal rate of technical substitution (M RTS)? (a) MRTS =-1 2.5x, (b) MRTS = -x2/x1 (c) MRTS = -5x2/01 (d) MRTS =-0.5x2/21 (e) MRTS = -0.2x2/21 %3D %3D
6. A company uses two inputs, unskilled labour (L) and capital (K), to produce itsproduct. The wage rate for a unit of labour is €5, while a unit of capital cost €20.a) Determine the equation and plot the isocost line for the company's expenditures on itsinputs of €1,000. Label the intercepts of the isocost with both axes. Draw a typical isoquantfor an output level Q0 and indicate the optimal input levels of L and K. (Do not forget tolabel the axes).b) Suppose the government introduces a minimum wage for unskilled labour of €6 per unit.Show graphically and explain shortly how much it would cost the firm in the short run,with capital input fixed at K, to keep its output constant at Q0.c) Show graphically and comment shortly on the optimal factor mix that the firm would useto produce Q0 in the long run at the specified minimum wage of €6 per unit
Write the technical rate of substitution expression for f(x1, x2) = (x1 - 1)0.25 x20.5
In the Cobb-Douglas production function (Q - aL³¹K²): O a. a and b b. the marginal product of labor (L) is equal to 1 O c. a and c d. if the amount of labor input (L) is increased by 1 percent, the output will incre e. the average product of labor (L) is equal to 32
(A) With P = 20, W = 25 and TFC = 500: Labor Output (Q) (L) 5 10 25 35 50 60 10 25 60 70 80 90 Marginal Physical Product of AVC=VC/Q ATC=TC/Q Labour (MPPL) 2 3 4 2 2 1 Average Physical Cost Product of (TC) (VC) Labour (APPL) 2 2.5 2.4 2 1.6 1.5 MPPL = Change in Q / Change in L APPL=Q/L TC = TFC + VC VC=W* L MC = Change in TC / Change in Q Total Variable Marginal Average Cost Variable 625 750 1125 1835 1750 2000 125 250 625 875 1250 1500 Cost (MC) 15 10 6 10 15 30 Average Total Cost Cost (AVC) (ATC) 12.50 10.00 10.42 12.50 15.63 16.62 62.5 30.00 18.75 26.21 21.88 22.22 Based on this table, answer this: 1. How much output will this firm produce? If the price of output increases to $30, how does your answer change? 2. If the productivity of labor increases by 10% (all else equal), how much more labor will the firm hire? 3. Below what price will this firm decide to produce zero units of output? (i.e. shut down)
What is the marginal rate of substitution of x for y when x = 16 and y = 54?
5. Assume Q=K0.25 10.75 (a) Find the total differential dQ. (b) Use the total differential to find the slope of an isoquant (where Q is contant), dK (c) Show that the isoquant is convex.
Suppose Mr. Saad is a producer of Lola Loo chocolate, following is the information available of his production plant. Quantity of Labour (L) Quantity of 1 2 3 4 5 Capital (K) 10 15 25 100 50 20 30 40 50 75 50 75 100 125 150200250 300 75 90 105 120 2 30 50 62 15 If K and Lare imperfect substitutes and complements from the information above draw at least three isoquant (map) and identify the level of production. H73 4
The technical rate of substitution between factors x2 and x1 is −4. If you desire to produce the same amount of output but cut your use of x1 by 3 units, how many more units of x2 will you need?
The slope of an isoquant is known as
SuProse a liim hus revenue R=15t- 5q2 und (Ost (= 93-13.5e+ 50+ 40. Make a sketch of average Variable cOst, marginal (ost and maigina fevenue.

SEE MORE QUESTIONS

Recommended textbooks for you

ENGR.ECONOMIC ANALYSIS

Economics

ISBN:

9780190931919

Author:

NEWNAN

Publisher:

Oxford University Press

Principles of Economics (12th Edition)

Economics

ISBN:

9780134078779

Author:

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

Publisher:

PEARSON

Engineering Economy (17th Edition)

Economics

ISBN:

9780134870069

Author:

William G. Sullivan, Elin M. Wicks, C. Patrick Koelling

Publisher:

PEARSON

ENGR.ECONOMIC ANALYSIS

Economics

ISBN:

9780190931919

Author:

NEWNAN

Publisher:

Oxford University Press

Principles of Economics (12th Edition)

Economics

ISBN:

9780134078779

Author:

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

Publisher:

PEARSON

Engineering Economy (17th Edition)

Economics

ISBN:

9780134870069

Author:

William G. Sullivan, Elin M. Wicks, C. Patrick Koelling

Publisher:

PEARSON

Principles of Economics (MindTap Course List)

Economics

ISBN:

9781305585126

Author:

N. Gregory Mankiw

Publisher:

Cengage Learning

Managerial Economics: A Problem Solving Approach

Economics

ISBN:

9781337106665

Author:

Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike Shor

Publisher:

Cengage Learning

Managerial Economics & Business Strategy (Mcgraw-…

Economics

ISBN:

9781259290619

Author:

Michael Baye, Jeff Prince

Publisher:

McGraw-Hill Education

SEE MORE TEXTBOOKS

An isoquant curve for producing a 10 lb bag of wheat is given as below. What is the Marginal Rate of Technical Substitution (MRTS) at a point (L, K)=(2,9)? 15 Capital 14 1, 14 11 9 TELEUR876543210 -4 -3 4 3 1 2,9 3,5 43 52 6,1.5 2 3 4 5 6 7 Labor