A firm has the production function Q = K0.5L0.5. The wage is W and the rental rate

Question:

A firm has the production function Q = K0.5L0.5. The wage is W and the rental rate on capital is R. Derive the demands for capital and labor as a function of Q, W, and R.

Fantastic news! We've Found the answer you've been seeking!

Step by Step Answer:

Related Book For book-img-for-question

Microeconomics

ISBN: 9781464146978

1st Edition

Authors: Austan Goolsbee, Steven Levitt, Chad Syverson

See More Books

Question Posted: Jan 13, 2016 02:37 AM

See More Questions

A firm has the production function Q = K0.4L0.6. The wage is $60, and the rental rate on capital is $20. Find the firm's long-run expansion path.
A firm has the production function Q = LK. For this production function, MPL = K and MPK = L. The firm initially faces input prices w = $1 and r = $1 and is required to produce Q = 100 units. Later...
A firm has the production function f(x, y) = min {2x, x + y}. On the graph below, use red ink to sketch a couple of production isoquants for this firm. A second firm has the production function f(x,...
[15] Which register transfer statement is equivalent to WRITE microopeation: a) DRAC b) DR M[AR] c) M[AR] DR d) AC DR
Following is the liabilities section of a recent balance sheet of Alliant Techsystems, Inc. (www.atk.com), a commercial ammunitions and defense and aerospace company. Amounts are expressed in...
In a certain experiment, cylindrical samples of diameter 4 cm and length 7 cm are used (see Fig. 169). The two thermocouples in each sample are placed 3 cm apart. After initial transients, the...
Explain the importance of a written contract.
The following transactions of Great Value Pharmacies occurred during 2018 and 2019: 2018 Mar. 1 Borrowed $390,000 from Bartow Bank. The six-year, 13% note requires payments due annually, on March 1....
Saturna Corporation began Year 6 with the following account balances: Common shares, 1 0 0 , 0 0 0 shares authorized, 5 0 , 0 0 0 issued $ 1 , 2 0 0 , 0 0 0 Retained earnings 9 5 0 , 0 0 0 During...
1. What type of attitude scale is used by the ACSI if any? 2. What type of attitude study might you design if you were the consultant? 3. How would you use results from this approach to diagnose...
Speedy Printing uses photocopiers (K) and printers (L). Its production function is Q = K0.75L0.25, where Q is the number of pages per day. Suppose that the rental rate on copiers is $48 per day and...
Jenny is considering starting a new business selling organic groceries. It would cost her $350,000 a year to rent store space and buy the groceries from a wholesaler, and she would have to quit her...
A&P Grocery Stores decided to sell its own brand of canned milk (referred to as private label milk). A&P asked its longtime supplier, Borden, to submit an offer to produce the private label milk....
1. Prepare journal entries to record the following transactions for Sherman Systems. a. Purchased 6,900 shares of its own common stock at $44 per share on October 11. b. Sold 1,475 treasury shares on...
Portsmouth Company makes upholstered furniture. Its only variable cost is direct materials. The demand for the company's products far exceeds its manufacturing capacity. The bottleneck (or...
Martinez Company's relevant range of production is 7,500 units to 12,500 units. When it produces and sells 10,000 units, its average costs per unit are as follows: Average Cost per Unit Direct...
Lincoln Enterprises has budgeted sales for the months of September and October at $ 1 7 0 , 0 0 0 and $ 1 0 0 , 0 0 0 , respectively. Monthly sales are 8 0 % credit and 2 0 % cash. Of the credit...
National Corporation granted 15 million options on January 1, 2021, that permit executives to purchase 15 million of the companys $1 par common shares within the next eight years, but not before...
Find div(F x G) = . (F x G). F(x, y, z)= i + 3xj + 2yk G(x, y, z) = xi - yj + zk
On January 2, 20X3, Sheldon Bass, a professional engineer, moved from Calgary to Edmonton to commence employment with Acco Ltd., a large public corporation. Because of his new employment contract,...
Which of the following statements are true about the efficient market hypothesis? a. It implies perfect forecasting ability. b. It implies that prices reflect all available information. c. It implies...
The Home Improvement Building Supply Company has received the following order for boards in three lengths: Length Order (quantity) 7 feet .........700 boards 9 feet ..........1200 boards 10 feet...
1. Suppose you belong to a tennis club that has a monthly fee of $100 and a charge of $5 per hour to play tennis. a. Using Figure as a model, prepare a table and draw a curve to show the relationship...
In what ways do organizations integrate sustainability principles and circular economy concepts into their innovation strategies, including cradle-to-cradle product design, resource recovery...
On December 31, 2022, Skysong Inc. owns a machine with a carrying amount of $824,000. The original cost and accumulated depreciation for the machine on this date are as follows: Machine $1,400,000...
discuss the following terms Concepts of Motivation at work place 2) Six Real life situations of Motivation at work place 3) Benefits observed of Motivation at work place 4) Limitations observed of...

A firm has the production function Q = K0.5L0.5. The wage is W and the rental rate

Question:

Step by Step Answer:

We can solve this problem by using a Lagrangian or the costminimization condition ...View the full answer

Microeconomics

Students also viewed these Economics questions