# Question

A firm has a production function Q = F (K, L) with constant returns to scale. Input prices are r = 2 and w = 1. The output- expansion path for this production function at these input prices is a straight line through the origin. When it produces 5 units of output, it uses 2 units of K and 3 units of L. How much K and L will it use when its long- run total cost is equal to 70?

## Answer to relevant Questions

A firm employs a production function Q = F( K, L) for which only two values of K are possible, K1 and K2 . Its ATC curve when K = K1 is given by ATC1 = Q2 - 4Q + 6. The corresponding curve for K = K2 is ATC2 = Q2 - 8Q + 18. ...A firm purchases capital and labor in competitive markets at prices of r = 6 and w = 4, respectively. With the firm’s current input mix, the marginal product of capital is 12 and the marginal product of labor is 18. Is ...Would the market for dry cleaning be perfectly competitive in large cities such as San Francisco or New York City? Why or why not? How about in a small city such as Athens, Ohio, or Meredith, New Hampshire?A perfectly competitive firm faces a price of 10 and is currently producing a level of output at which marginal cost is equal to 10 on a rising portion of its short- run marginal cost curve. Its long- run marginal cost is ...Suppose a representative firm in a perfectly competitive, constant-cost industry has a cost function TC = 4Q2 + 100Q + 100.a. What is the long-run equilibrium price for this industry? b. If market demand is given by the ...Post your question

0