Answer to Question #68099 in Microeconomics for aretin bella

Question

1.The Bell Corp manufactures plastic broom and mop holders, and the production function for these holders is expressed as:


Q = 50 L.8K.2


Where: Q = number of plastic holders produced per day

L = units of labor input per day

K = units of capital input per day.

Let K = 1000 and L = 100

Calculate the average product of labor and the marginal product of labor.





2.A firm has a production function:

Q= 5L.8K.25


Where : Q = number of metal stampings produced per day

L = unit of labor input per day

K = unit of capital input per day

Labor is a variable input, whereas capital is a fixed input. The selling price of Q is RM9.00 per unit; The purchase price of capital is RM 100 per unit; and the purchase price of labor is RM20 per unit.

If K is fixed at 100 units, determine the number of units of labor to purchase each day in order for the firm to maximize profit.

Answer 1

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